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Rinnai CorporationaorContents
1

Top Message
Message from the Chairman
Message from the President

4

Vision and Medium-Term Business Plan

6

Rinnai Group CSR

8Management System

14

With Our Stakeholders

16
20

Feature 1

Comfort, Economy, and Environment

SALES FRONTLINE PERSPECTIVE

23

Feature 2 Contributing to Local Communities: Korea
With Our Customers

35

With Our Employees

49With Our Shareholders and Investors

51

With Our Business Partners

55

With Our Communities and Society

60

Environmental Policy

67

Environmental Action Plan and Results

71

Environmental Accounting

73

Developing Environmentally Conscious Products

82

Environmentally Conscious Monozukuri

96

Environment Education and Promotion of Awareness

100

Chronology of Environmental Activities at Rinnai

102

Major Award Winning History

103

Summary of Rinnai Group

105

Rinnai Group

Supplemental Data:
1. Oguchi Factory

2. Seto Factory

3. Asahi Factory

4. Rinnai Parts Center

5. Yanagisawa Manufacturing Co., Ltd.

6. Rinnai Technica Co., Ltd.

7. RB Controls Co., Ltd.

8. Rinnai Precision Co., Ltd.

9. RT Engineering Co., Ltd.

10. Japan Ceramics Co., Ltd.

11. Noto Tech Co., Ltd.

12. Techno Parts Co., Ltd.

CSR Report 2013│Top Message

Top Message
Message from the Chairman
Rinnai traces its history to 1920, when it began manufacturing and selling petroleum
stoves. In the following year, it started handling gas appliances and has steadily expanded
its operations ever since. During World War II, the Company’s facilities were used tomeet military demand, but after the war it resumed its business centering on the
production and sale of gas appliances. Today, Rinnai is a comprehensive manufacturer ofheat-energy appliances with operations in 16 nations worldwide, excluding Japan. We
attribute our success to the support we have received from everyone over many years,
and we are deeply thankful.
Under the motto of “harmony, spirit, and sincerity,” Rinnai’s Corporate Mission is“to use heat to provide society with comfortable lifestyles.” With our top priority on thetenet that “Quality is our destiny,” we focus our efforts on the pursuit of safe, highSusumu Naito, Chairman
quality products. At Rinnai, “quality” is not limited to product manufacturing, but covers
all of our operations, including distribution, customer relations, and after-sales service.
Overseas, we offer products that are matched to local needs, committed tomaintaining the level of quality that our customers demand in Japan. For this reason, we
endeavor in principle to appoint people from local countries and communities to top
positions in our overseas subsidiaries, so that we can better grasp and reflect thesentiment of consumers local to our business there.
Environmental issues, particularly global warming, have become a majorinternational challenge. As a comprehensive manufacturer of heat-energy appliances, weare strongly aware of the huge role we must play. Going forward, we will target ongoing
improvements in safety and peace of mind, comfort, and environmental performance inorder to benefit society.

Message from the President
Introduction
Rinnai is a comprehensive manufacturer of heat-energy appliances specializing in gas
equipment. We advance our operations globally with strong emphases on heat and lifestyles,
product quality, and contribution to local communities.
Because the appliances that we handle are essential to people’s daily lives, we have amajor role to play because our core business, by its nature, contributes to society.
At the heart of this approach is our corporate philosophy, “Quality is our destiny,”
which has guided the Company’s business over many years. We focus on manufacturing
products that provide comfort and environmental benefits while placing top priority on safety.

Protecting the environment by promoting Eco Jozu hot-water units andECO ONE hot-water/heating systems
One of our most important environmental challenges is the prevention of global warming,and the Rinnai Group focuses particular attention to this area.
Hot water and air-conditioning account for around 60% of energy consumed in the
average Japanese home. If we can reduce the volume of greenhouse gases emitted byhouseholds, therefore,
we can contribute significantly not only to preventing global warming but also addressing
Hiroyasu Naito, President
various other environmental challenges. To this end, we are focusing on our ECO ONE hotwater/heating system with a heat pump that utilizes atmospheric heat, which combines ourhighly efficient Eco Jozu hot-water unit. Going forward, we will work hard to generate

1CSR Report 2013│Top Message

widespread demand for ECO ONE while stepping up efforts to promote our Eco Jozu
offerings.
In another initiative, we have commenced R&D aimed at bringing together the “smart
house” concept and home energy management system (HEMS) technologies.

Defective dishwasher/dryers: Inspection/repair work and prevention ofincident recurrence

Under our corporate philosophy, “Quality is our destiny,” we have placed top priority on the
pursuit of safety. In August 2012, however, it came to light that some of ourdishwasher/dryers were defective. We regret the major inconvenience caused to users andother related people and deeply apologize for the problem.
When the issue came to light, we moved swiftly to form a service task force and havesince undertaken about 340,000 inspections of the models in question. In each case, we havegiven a detailed explanation to the customer about the status of their machine and undertaken
appropriate repairs. Going forward, we will work to ensure a more widespread understandingof our inspection and repair work and increase the ratio of fully repaired machines. We will
not stop until every machine is fixed.
Fulfilling our responsibilities as a manufacturer, meanwhile, we will continue various
efforts to prevent a recurrence. These include studying the cause of defects, conducting arigorous design review, and modifying product design specifications.

“Barrier free temperature” bathroom heater/dryers that prevent “heatshock”
Rinnai deploys it core business to foster social contribution activities. A new initiative in thisarea is to achieve “barrier free temperature” environments. This means preventing the “heatshock” phenomenon that is caused by sudden increases and decreases in blood pressure when
the body is subject to dramatic changes in temperature. This often happens in winter, forexample, when a person moves from a warm room to a cold bathroom, then enters a hot bath.
It is estimated that around 17,000 people die in their bathrooms each year in Japan, equivalent
to about four times the annual death toll from road accidents, which number more than 4,000.
A very effective way to prevent heat shock is to warm up the bathroom to avoid roomto-room temperature changes as much as possible. The potential threat of “heat shock” andthe effectiveness of bathroom heater/dryers in addressing the problem are not widely
understood. For this reason, we plan to undertake an advertising campaign.

Advancing overseas operations in accordance with local needs and attributes
In North America, we are focusing on reorganizing our marketing activities and upgrading
our distribution system. Our plan is to actively promote the convenience and environmental
benefits of instant-heating (tankless) hot-water units compared with the storage type (tankbased) systems that are still mainstream in the North American market. We will use public
relations activities to get this message across.
In China, we have focused mainly on the market in and around Shanghai to date.
Going forward, however, we will target other major cities, such as Tianjin, Chengdu, andChongqing, with our sales activities. We will also expand and upgrade our production
facilities in China.
Similarly, in Europe, Southeast Asia, Oceania, and elsewhere, we will pursue
initiatives according to specific regional attributes, such as consumer tastes, energy factors,
and economic conditions.

Targeting further dramatic progress under Jump Up 2014
Rinnai is currently implementing its medium-term business plan, entitled Jump Up 2014,
which began in April 2012. (For more details, please see pages 4–5.)
In the first year of the plan, ended March 2013, we posted sluggish overseas sales atthe beginning of the term caused by a stagnating world economy, although our performance inJapan was solid. In August 2012, however, the problem of the defective dishwasher/dryers
came to light, incurring various expenses for inspections and repairs. As a result, consolidated
net sales increased 2.1% year on year, to ¥251.8 billion. Operating income slipped 1.1%, to¥26.3 billion, and net income rose 15.3%, to ¥19.3 billion. In the current fiscal year, ending

2

CSR Report 2013│Top Message

March 2014, we are targeting net sales of ¥268.0 billion, operating income of ¥30.0 billion,
and an operating margin of 11.2%.

Contributing to local economies through participationin the Nakagawa Canal Restoration ProjectAs a member of regional society, the Rinnai Group has focused efforts on local communities,
including rejuvenating regions near its local operations and addressing local environmental
issues. The Nakagawa Canal, which flows near Rinnai’s Head Office, functioned for many
years as an important piece of transport infrastructure.
To assist in its restoration, Rinnai has become a participant in the Nakagawa Canal
Restoration and Culture/Art Activity Assistance Project (ARToC10), headed by the Nagoya
Urban Institute of the Nagoya Urban Development Public Corporation. Our involvement
entails donating ¥10 million annually over a 10-year period, bringing total assistance to ¥100
million. Through the project, we hope to recreate the bustling former glory of Nakagawa
Canal, making it once again a valuable cultural asset that helps stimulate local communities
and industries.

Concluding message to stakeholders
The Rinnai Group is committed to business activities based on long-term perspectives rather
than the pursuit of short-term profits. Under our corporate philosophy, “Quality is ourdestiny,” we will emphasize high quality product manufacturing that guarantees safety andpeace of mind. In these ways, we will strive to improve corporate value by maintaining andenhancing the value of the Rinnai brand in the global market.

3

CSR Report 2013│Vision and Medium-Term Business Plan

Vision and Medium-Term Business Plan
Delivering Heat and Comfortable Lifestyles
Heat and energy appliances are essential items for daily life. They are also a key factor enabling humans to use heatin a safe, comfortable, and efficient manner. Rinnai’s business operations are guided by its Corporate Mission,
which is “to use heat to provide society with comfortable lifestyles.” We have amassed considerable know-how byaccumulating technologies to generate heat and technologies that make heat easy to use. Deploying our core originaltechnologies, we have consistently delivered safe, high-quality heat and energy appliances that enhance people’s
lives. Recently, however, society’s needs have grown more sophisticated, and people are now demanding the “bestmix” of offerings that deliver primary energy efficiency and help save energy and protect the environment. Rinnai
is cognizant of customers’ varying situations in such areas as number of household occupants, living patterns,
energy use times, and weather conditions. In all situations, we will continue contributing to society as acomprehensive manufacturer of heat and energy appliances.

4

CSR Report 2013│Vision and Medium-Term Business Plan

Medium-Term Business Plan: Jump Up 2014
We predict that future medium- and long-term economic trends, characterized by a growing world population andimproving living standards especially in newly emerging nations, will support further increases in households using
advanced heating appliances. Accordingly, we look forward to continued growth in heating appliance markets.
Moreover, efforts to reassess the worldwide energy structure have gathered pace, and people’s lifestyles arediversifying as we approach the era of renewed demand for the best mix of energy and better environmental andenergy-saving performances. Facing these challenges, the Rinnai Group formulated its medium-term business plan,
Jump Up 2014. Guided by the plan, we are striving to increase corporate value and contribute to society as acomprehensive heat and energy appliance manufacturer.
We will also reinforce our corporate foundation underpinned by core management issues—which we callthe Three Jump Up Priorities—in order to build a long-term growth trajectory. A key issue is to promote sales of
ECO ONE, a hybrid hot-water/heating system that uses both electricity and gas to realize the world’s best
environmental and energy-saving performance levels. We are also actively promoting our Eco Jozu series of highefficiency hot-water units that contribute significantly to the environment and energy-savings. In these and otherways, we are will supply products that contribute to global environmental protection. With respect to our global
strategy, we will further upgrade our product lineups in existing markets while tapping new priority markets, inorder to help local communities enjoy more abundant lifestyles.

5

CSR Report 2013│Rinnai Group CSR

Rinnai Group CSR
Schematic Diagram of Company Ideals

6CSR Report 2013│Rinnai Group CSR

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

Heat and
Lifestyles
Quality
Contributing
to LocalCommunities

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

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

Heat and Lifestyles

Quality

Contributing toLocal Communities

Hot water and heating appliances account for much of the energy used in the averagehome. By developing, manufacturing, and selling appliances with exceptional energy
efficiency, Rinnai helps reduce emissions of greenhouse gases from homes.

To fulfill our Corporate Mission, which is “to use heat to provide society with
comfortable lifestyles,” we deploy our advanced technologies and know-how todevelop products that people can use in a safe, comfortable, and efficient manner. In
this way, we help people lead abundant lifestyles.
To offer customers safety and peace of mind, we adhere to the basic tenet that
“Quality is our destiny.” To this end, we pursue a “zero defects” objective when
designing, making, and selling our products, to ensure they remain fault-free until
they are no longer used by the customer.
Rinnai’s aim is to deliver products and services that meet climates, lifestyle cultures,and customs that differ from Japan. In principle, we focus on local production andlocal sales in advancing our overseas business, so that we can help improve the lives of
local people around the world.

7

CSR Report 2013│Management System

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

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

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

Board of Directors
The Board of Directors has decision-making authority for important management issues affecting Rinnai andoversees the execution of duties by directors. The Board has six members and as a rule meets once a month.
Some directors below the rank of president hold concurrent positions as executive officers and are
responsible for conveying the content of Board decisions to the managers of divisions under their respective
supervision and for executing operations. In addition, general groupwide meetings as well as parent-only
meetings are held every three months so that directors can pinpoint the status of issues affecting operations
and share information on pertinent topics. Moreover, to clarify the management responsibilities of eachbusiness year and gain trust from shareholders, Rinnai regulates the term of director to be one year.
8

CSR Report 2013│Management System

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

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

Corporate Governance Structure

9CSR Report 2013│Management System

Risk Management
Risk Management Promotion System
As social structures become more complex, the risks faced by companies become more diverse. In this operating
environment, the Rinnai Group strives to manage existing and emerging risks to support global businessdevelopment and ensure stable business activities that sustain the trust of customers and society as a whole.
The Risk Management Committee, chaired by the president, meets regularly. The committee assigns adivision to oversee each risk with the potential to influence our corporate survival, credibility, business pursuits
and assets, and is also tasked with risk-lowering duties, such as formulating preventative measures, resolving
issues before they turn into crises, minimizing losses and defining strategies to avert the recurrence of any risks
that become a reality. Methods for hedging risk are promoted laterally throughout the Group.
In our efforts to secure workplace safety and prevent accidents we designate the 27th of each month as
Safety Day. On this day, safety patrols are conducted at the Technology Development Center and factories. As ameasure for reducing on-the-job accidents and injuries, we have established the Anzen Dojo (a safety training hallwhere potential workplace events are simulated) at each factory as a place for safety education.

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

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

10

CSR Report 2013│Management System

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

Corporate Ethics Committee
Chairman(President)

Measurements

Committee members(Selected fromeach headquarters)

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

Each department

Rinnai Group “Code of Ethics”
The Rinnai “Code of Ethics” is a small booklet which combines Rinnai’s Corporate Philosophy and Code of
Conduct, which embodies the detailed behaviorial standards that all executives and employees are required toobey. The Compliance Committee member allocated to each workplace provides all employees in the workplacewith “Code of Ethics” training each year for its enforcement.
The English-version “Code of Ethics” was issued and distributed to the 19 overseas Group companies,
and local language versions were distributed to Group companies in China and South Korea.

“Code of Ethics” booklets
of various countries“Code of Ethics" training sessions(Rinnai Holdings (Pacific) Pte Ltd. (Singapore; left),and Guangzhou Rinnai Gas and Electric Appliance Co., Ltd. (China)

11

CSR Report 2013│Management System

Compliance Education Activities
Within the company, the President himself takes the initiative by sending messages on corporate ethics to
employees to improve their awareness of compliance issues.
Moreover, regarding specific laws that individual departments have close relationship with, the Legal
Department takes the lead by providing legal education every year. In fiscal 2013, a total of 785 Group employees
undertook training to improve their knowledge of the law.
We also provide ethical education for new recruits and for employees in specific job classes every year,with a total of 353 employees attending sessions in fiscal 2013.

Fiscal 2013, Actual of number of training attendants
Name of course
Number of attendants
Legal education
785 people
Ethic education by layer
353 people

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

Compliance education poster

Confirmation and Modification of Compliance Activities
Every year, we conduct employee questionnaires to ascertain how deeply ingrained our Corporate Philosophy has
become. In fiscal 2013, breaking down the penetration rate for each component of our corporate philosophy, we
found that 99.8% of respondents were familiar with the corporate motto and 99.0% recognized our corporate
mission. We will continue to actively promote compliance activities to maintain these high levels.

12

CSR Report 2013│Management System

Facilitation of Internal Reporting System
If, in the course of business activities, an employee at adomestic company under the Group umbrella suspects
possible breach of laws or the internal rules or unfair
practices, and it is difficult to approach a superior or the
person responsible for the division with such suspicions,the employee may report the perceived infraction to the
Corporate Ethics Helpline.
In this system, we stipulated that the person who reported
the incident will not receive any unfair treatment by thefact that he/she consulted the matter and we also pay a full
attention to the protection of privacy of the person who
made the report.
In fiscal 2013, the helpline received eight calls for
consultation and report. Appropriate measures have beentaken, including investigation and confirmation of the facts
in these cases of alleged misconduct.

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

SolvedNot solved
Corporate Ethics Helpline

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

Protecting Personal Information
Rinnai applies internal rules based on the Act on the Protection of Personal Information. In addition, our Privacy
Policy was instituted for the handling of personal information and posted on our website. Utilizing these, we
strive to ensure appropriate storage, handling and protection of customer data.
Accordingly, we established the position of Chief Privacy Officer at the head office and require theappointment of privacy officers at all workplaces, including the offices of Group companies in Japan, to educate
employees who handle personal information, and to establish physical and technical systems to insure the safe
management of personal information in each workplace.
The privacy officers also conduct an internal audit once a year to verify the quality of personal
information management in each workplace. There were no instances of personal information being leaked infiscal 2013.

Compliance Violations
There were no serious compliance violations in fiscal 2013.

13

CSR Report 2013│With Our Stakeholders

With Our Stakeholders
We are committed to two-way communication with all of our stakeholders, in order to build trusting relationships,
continually evolve our business, and increase stakeholder satisfaction.

Two-Way Communication Initiatives
Throughout the Rinnai Group, we place great importance on communication with customers, employees,
shareholders, investors, business partners, local communities and the general public.
We communicate with our customers through channels such as exhibitions, events and our online
shopping site, and use their comments and requests to help us improve our products and services. We exchange
information with our business partners on subjects such as management policies and product strategies, and also
work together to improve management through activities such as our Level-Up Workshop and Shipping
Subcommittee.
We disclose information to our shareholders and investors in an appropriate and timely manner, andorganize regular meetings, tours and other events to give them a better understanding of the Group’s activities.
We will continue to engage in close communication with all of our shareholders, so that we can evolveour business activities and improve levels of satisfaction even further in the future.

14

CSR Report 2013│With Our Stakeholders

15

CSR Report 2013│Feature 1:Comfort, Economy, and Environment

Feature 1 Comfort, Economy, and Environment

SALES FRONTLINE PERSPECTIVE

Rinnai’s ECO ONE Hybrid Hot-Water/
Heating System: Today and Tomorrow
In 2010, Rinnai released the world’s first* hybrid hot-water/heating system.
Called ECO ONE, it combines Rinnai’s highly efficient gas water heaterwith an air-source heat pump. ECO ONE quickly gained a reputation for its
rapid heating of water along with energy efficiency and environmental
friendliness, and sales have climbed steadily as a result. In this special
feature, we talk with Mr. Hirohisa Kakinuma from Morinomegumi Kobo
and Ms. Yoshie Ishizuka from Sumitomo Realty & Development Co., Ltd.
about the role they expect ECO ONE to play in the future.
* Applies to hot-water/heating system for home use that combines a heat pump and highly efficient hot-water unit.

ECO ONE for rapid generation of warmth plus a hot-water room heater“Even if no-one in this region uses an air conditioner, you won’t find anyone
who doesn’t use a heater. In fact, heating is so important that it comes second
to the floor plan when building a new house.” So says Hirohisa Kakinuma,
senior managing director at Morinomegumi Kobo, which designs new houses
centering on Sendai City in Miyagi Prefecture.
Houses designed by Morinomegumi Kobo are distinctive for theiruse of solid wood materials. Because floor heating warps solid wood, thecompany cannot use this form of heating in their houses. Mr. Kakinuma goeson to say, “In and around Sendai, you can’t get through winter using only aheat pump that also works as an air conditioner. Accordingly, our company hassuggested to customers that they use gas for room heating and hot water even
if their house is designed to use all-electric appliances. Now, we recommend
Hirohisa Kakinuma
systems like ECO ONE and Eco Jozu as heat sources, because they produce
Senior Managing Director
hot water quickly and generate plenty of warmth by using hot water for room
Morinomegumi Kobo
heating.”
According to Mr. Kakinuma, there has been a shift in consumer thinking regarding electricity and gas
since the Great East Japan Earthquake. Manufacturers were inundated with products needing repairs because
many conventional electric Eco Cute systems sustained damage as a result of the earthquake and tsunami. It
appears that manufacturers weren’t able to keep up with demand due to a shortage of labor. Consequently, whileelectricity was restored relatively quickly, many households were unable to get hot water because of damage tothe electric hot-water unit—a key component of the Eco Cute system. Gas services took a little longer to restore
compared with electricity due to the time required to check that gas lines were safe. However, because gas heatsources came out largely unscathed, people living in affected areas were able to begin using hot water again withminimum delay. Mr. Kakinuma says that as a result of this experience, “Our impression is that more people now
want to use gas as a heat source.”

Beating the cold, a reason behind house renovation;
economic merits drive the proliferation of ECO ONE
So how is the home renovation market reacting to ECO ONE? Ms. Yoshie
Ishizuka from the Morioka Sales Office of Sumitomo Realty & Property
Development’s Shinchiku Sokkurisan home renovation business says, “Theappeal of an ECO ONE system is that the overall cost is lower. That is because
the cost of utilities when using the system is lower than when using electricity
or kerosene as a heat source.”
Yoshie Ishizuka
Interior Decorator, 2nd Class Architect &Chief Residential Manager
Shinchiku Sokkurisan Morioka Sales OfficeHome Renovation Business Division
Sumitomo Realty & Development Co., Ltd.

16

CSR Report 2013│Feature 1:Comfort, Economy, and Environment

In Morioka City and its environs, it is not unusual for the temperature to drop to –7˚C or –8˚C, andresidents often decide to renovate because their home is too cold in winter. Previously, many consumers shied awayfrom gas due to the cost, and opted for electricity or kerosene instead. However, prices of energy sources that wereonce reasonable have increased. This is due to various factors, including yearly increases in kerosene prices, higher
electricity prices following the Great East Japan Earthquake, and the removal of discounted night-time electricity
rates.
Against this backdrop, Rinnai’s ECO ONE system has attracted growing attention as a single heating
system that provides heating and hot water for the whole home. One reason for the system’s proliferation has been
the setting of reasonable winter gas prices thanks to the cooperation of LPG and city gas suppliers. According to
Ms. Ishizuka, “There are cases where prior to renovation the cost of home heating (kerosene) stood at around¥40,000 to ¥50,000 per month, but after renovation incorporating an ECO ONE system, the cost fell to ¥30,000. I
recommend the use of ECO ONE to around 90% of the customers I deal with personally.”

Reducing household CO2 emissions a major challenge
Keeping utilities charges low means using less gas and reducing CO2 emissions (see Graph 1). ECO ONE makes auseful contribution to the reduction of CO2 and other greenhouse gases produced by households.
With the prevention of global warming a major international challenge, industries in Japan have beenworking hard to reduce such emissions for some time. Households account for around 15% of the country’s CO2
emissions (see Graph 2). A look at changes over the last few years reveals that while the amount of emissions
generated by the industrial sector has been decreasing, emissions produced by the residential sector have risen (seeGraph 3). It is becoming increasingly unlikely that the industrial sector can continue to make significant emission
reductions, but there is plenty of scope for reductions in the residential sector.
It is not generally known that hot water and room heating account for more than 50% of average
household energy consumption (hot water 28.3%; room heating 26.7%; refer to Column 1). Rinnai believes that
reducing the amount of energy used by hot-water units and heating appliances helps curb total household energy
consumption. Our aim is to help lower household energy costs by focusing on the increased adoption of the highly
energy efficient ECO ONE system.

17

CSR Report 2013│Feature 1:Comfort, Economy, and Environment

COLUMN 1

Hot water and room heating account for over 50% of
total household energy consumption
For many years, various energy-saving technologies have beendeveloped and introduced in Japan amid efforts to improve energy
consumption efficiency.
However, lifestyle changes have seen an increase in the amount of
CO2 emissions generated by households. A look at household energy
use shows that hot water and heating account for more than 50% ofenergy consumption in the average home. Accordingly, a decrease inenergy consumption for these purposes should make a significant
contribution to overall CO2 emission reductions.

Boosting sales promotion activities to promote energy saving at home
Rinnai is taking various steps to inform more and more people about ECO ONE, its
increasingly popular hot-water/heating system.
One such method is television commercials. By producing and broadcasting
eye-catching commercials, we have increased awareness of the ECO ONE name. As
Mr. Kakinuma also commented, “Whenever I suggest to a customer that they adopt
an ECO ONE system, more and more of them say they have seen ECO ONE
commercials on television.” In addition, Rinnai is actively disseminating information,such as by expanding information on its website explaining the system’s superior
performance.
While recognition of ECO ONE is steadily growing, Rinnai is alsobolstering efforts aimed at making it easier for home appliance companies andbuilding companies to recommend ECO ONE to their clients.
For example, we have produced a simulation that compares the runningcosts of an ECO ONE system with other heat sources. We designed this simulation
system taking into account the regional differences in electricity and gas charges,
lifestyles, and products. As a result, we are now able to obtain results that reflect theconditions in each area.
In another initiative, we have formed a dedicated ECO ONE sales force that is separate from our regularsales organization. At present, the new sales force has around 30 employees, including 20 full-time staff, who are
engaged in sales promotion activities throughout the country. Furthermore, these employees invite home appliancecompanies, residential construction companies, and end-users to Rinnai’s “Hot Lab” experiential showrooms at
branches and sales offices to see and experience the benefits of ECO ONE for themselves. Some of thesesalespersons are women, and we are receiving positive feedback about the kitchen-related advice they give on not
only hot water units but also gas stoves and other products from a female perspective.

ECO ONE offers a comfortable lifestyle using gas
The situation regarding electricity in Japan has changed dramatically since the Great East Japan Earthquake. A
turnaround in the country’s nuclear power generation policy has seen an increase in thermal power generation
facilities and government support for renewable energy and energy creation. In response to these changes,
consumers have also become more concerned about energy use. This in turn has created a surge in demand for a
comfortable lifestyle that makes the most of the advantages of each form of energy. At the same time, morehouseholds with high heating requirements have chosen ECO ONE as a heat source for their hot water and heatingneeds. Moreover, LPG and city gas providers have also taken the opportunity to offer comfortable living scenarios
to their customers. This has led to the creation of a new customer base for the ECO ONE system.
Rinnai developed the ECO ONE hybrid hot-water system as a product that helps protect the environment.
Despite a steady increase in unit sales, we plan to focus on technological development in order to introduce further
innovations. We will convey the advantages of ECO ONE to as many customers as possible by reinforcing sales
promotion in addition to product innovation.

18

CSR Report 2013│Feature 1:Comfort, Economy, and Environment

COLUMN 2: Message from a Marketing Manager

By promoting the widespread adoption of ECO ONE,
Rinnai will work to support energy-saving housing in Japan.

Kimiatsu Nakao
General Manager, Sales Planning
Office, Sales Division,
Marketing & Sales Headquarters

Rinnai undertakes regular surveys on awareness concerning the use of energy in thehome. The findings of these surveys suggest that consumers are unable to digest theexcessive amount of information available to them. One of our roles is to provide
information to customers in an appropriate manner. We will continue working to
explain the excellent features of ECO ONE in a way that is easy to understand, andin so doing encourage customers to add the system to their range of options.
As a country, Japan is currently working on increasing energy-saving housing,such as through the low-carbon house certification system. When the ECO ONE
system is adopted in a residence built with high thermal insulation, that residence
fulfills the criteria for a low-carbon house. Consequently, a house doesn’t have to bebuilt by a large home construction company in order to acquire certification.

19

CSR Report 2013│Feature 2: Contributing to Local Communities

Feature 2

Contributing to Local Communities: Korea
Safe, High-Quality Product Manufacturing Coupled with Excellent
After-Sales Service Makes Rinnai an Endearing Brand in South Korea

Rinnai consistently receives top company awards
and earns the trust of customers
Established in 1974, Rinnai Korea Corporation is one of the Rinnai Group’s oldest
overseas members. Its main products are home-use boilers used for heating, as well astabletop gas stoves and commercial appliances. Each of these products holds a solid
share in the country’s domestic market. Over the years, Rinnai has become the most
preferred brand of South Korean consumers. Today, some 40 years since its founding,many people believe that Rinnai is a South Korean manufacturer.
Rinnai Korea’s good reputation is also reflected in various prizes it hasreceived, such as awards sponsored by the Korean Management Association
Consulting (KMAC). Rinnai has been judged the No. 1 brand in seven categories formany years in succession. For example, it has been No. 1 in the home-use boiler
section of the Korean Industry Customer Satisfaction Index (KCSI) Survey 15 times,
including for seven consecutive years. Rinnai also received the Korea Best Brand
Award in the gas stove section by KMAC for 14 consecutive years. Awards such asthese illustrate Rinnai Korea’s sustained efforts to leave its rivals far behind. In
addition to acknowledging the safety and quality of its products, these awards also
demonstrate the high quality of Rinnai’s customer services.
Mainstay Products

Head officeCall center

Company Outline
Name: Rinnai Korea Corporation
Established: 1974
Head Office: Bupyeong-gu, Incheon
Sales Headquarters: Mapo-gu, Seoul
Customer Service Center: Yeongdeungpo-gu, Seoul
Net Sales: ¥22.5 billion(year ended December 2012)
Products: Home-use gas boilers, Tabletop gas stoves,
Commercial appliances

Tabletop gas stoves

Home-use gas boiler

Interview with President

As a South Korean gas appliance industry leader,
we aim to become a 100-year-old company

KANG YOUNG-CHUL
President, Rinnai Korea
Corporation

Rinnai Korea has earned solid support from its customers as a company that hashelped improve the lifestyles of Korean people over many years. Today, it
continues to be a leading supplier of gas appliances, which play an indispensablerole in people’s daily lives. Our company is widely recognized for its role increating the gas appliance and gas boiler sector. Going forward, we will
maintain our commitment to this sector as a leading player through ongoing
technical development as we seek to meet the expectations of consumers.
Next year will mark our 40th anniversary. With the aim of becoming a 100year-old company, we will strive to reinforce Rinnai Korea’s business base. At
the same time, we will continue efforts to retain the place we currently hold inpeople’s hearts for many years to come.
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CSR Report 2013│Feature 2: Contributing to Local Communities

High in-house manufacturing ratio and strong product focus;
customer service structure the best in the industry
Rinnai Korea’s head office and three factory sites are located in Incheon City. The company’s Sales Headquarters
and Customer Service Division, which includes a call center, are located in Seoul. Like Rinnai Japan, Rinnai
Korea’s factories are notable for their high in-house manufacturing ratio and high-quality product manufacturing.
The Customer Service Division in Seoul and 33 after-sales service centers throughout the country aretasked with fulfilling the company’s industry-leading customer service function. Unlike many manufacturing
companies that outsource after-sales services, Rinnai Korea operates its own after-sales service organization. The
after-sales service provided for boilers, which operates around the clock every day of the year and peaks in winter,
is unmatched by industry rivals.
The concept that “employees are family, and customers are benefactors” has been deeply rooted in Rinnai
Korea’s corporate culture for many years. The Customer Service Division deals directly with customers on a daily
Call center basis while adhering to the motto “customer-centered, location-centered.” This extensive support
system is the reason why Rinnai Korea has taken out the top spot in the KCSI surveys (home boiler category), andhas been awarded a host of prizes, including a Korean Service Quality Index prize and a Korean Industry Service
Quality Index prize.

Solid support in the South Korean boiler market
thanks to advanced capabilities and after-sales service
Winter is harsh in South Korea, with temperatures in Seoul
frequently dropping to between –2˚C and –5˚C. For the past
1,500 years or so, Koreans have used a traditional heating systemcalled ondol. The ondol heating system works by transferring
direct heat from a wood fire to underneath the floor. Today, themost popular version of this traditional method of heating isunder-floor heating using hot water heated by a boiler.
There are relatively few detached dwellings in South
Korea’s large cities, with apartment blocks providing the
majority of residential accommodation. At one time, eachapartment complex had a large boiler that supplied hot water(heating) to each apartment. However, this centralized heating
system was not without its problems. For example, individual
households were unable to regulate the temperature, and allhouseholds were charged the same rate irrespective of how much
hot water they used, while the hot water supply systems
deteriorated over the years. As a result, fewer and fewer of thesecentralized systems remain today.
Annual sales of home-use boilers in South Korea standat around one million units. Whereas rival manufacturers have
reduced the price of boilers in response to the recent economic
downturn, Rinnai Korea continues to release new energy-saving
and environmentally conscious products. Recent offerings
include burners with high energy efficiency that generate fewer
CO2 and NOx emissions, products with a “Full auto mode” that
automatically adjusts hot-water and heating temperatures inaccordance with changes in the outside temperature, and asystem with an “Eco save mode” that cuts gas charges by at least
14% compared with ordinary heating systems.
Another important feature is the extensive after-sales
service provided to customers who purchase a Rinnai boiler.
Heating is essential in South Korea due to its harsh winter, sowhen a boiler breaks down it must be repaired as quickly as
possible.
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CSR Report 2013│Feature 2: Contributing to Local Communities

We use information/communication and GPS technologies to monitor the location of repair technicians in real time,ensuring that the nearest technician can act quickly when a customer calls. In summer, the response time to requests
is within two hours of receiving a call from a customer, while in winter—when demand for repairs is heaviest—a
response is made the same day, or roughly within 12 hours of receiving the initial request. Rinnai Korea earns ahigh level of customer satisfaction in terms of both the promptness and quality of its repair service.

Interview with Employee

OH, JU YEON
Parts Manager, Customer
Consultation Team
Call Center, Customer Service
Division

We approach our work mindful that we are evaluated by our responses
The response by Rinnai’s call center to each customer call is important because
it affects how the company is evaluated. Here in South Korea, where winters are
extremely cold, a boiler breakdown can be a life-threatening situation. That is
why we receive most of our calls during winter. Recently, not only havecustomers become more knowledgeable about products, but they have also
become more demanding when it comes to the services we provide. As a result,
we are putting new employees through a three-week basic training course andworking in other ways to improve the center’s response capabilities. Our efforts
to solve customers’ problems become all the more fulfilling when we receive
words of appreciation.

Temperature sensors a standard feature on all gas stove burners
Rinnai strives to make its tabletop gas stoves as safe as possible. Korean cuisine does not include many deep fried
dishes, such as Japanese tempura. However, boiled food is common, and the custom of boiling clothing as a meansof sterilization remains. As a result, it was not uncommon for fires to be caused by leaving gas stoves on
unattended.
In light of this situation, in April 2013 it became legally mandatory for one burner in a tabletop stove to
be fitted with a sensor that shuts off the flame when a high temperature is reached. Since January 2014, all burners
now require sensors. Rinnai Korea pre-empted this regulatory change by making temperature sensors a standard
feature in its tabletop gas stoves.

With a business approach emphasizing respect and appreciation, we strive to benefit local
culture and communities
Rinnai Korea’s top priority is to “help improve the quality of life of consumers
by offering competitive and superior products.” With a business approachemphasizing respect and appreciation, we aim to be a company that is highly
attractive to both employees and business partners. This approach isundoubtedly the reason why Rinnai Korea receives solid support fromconsumers and other stakeholders.
On a cultural and community level, in 1986 Rinnai Korea formed the
Rinnai POPS Orchestra. Consisting mainly of Rinnai employees who studied
music at university, it is the only corporate orchestra of its kind in the country.
As well as giving regular concerts, the Rinnai POPS Orchestra performs atvarious community events.
Rinnai Korea has also helped in regions affected by floods, whichhave become more frequent in recent years. In these situations, we provide
emergency relief to local communities, such as by inspecting and repairing gas
appliances free of charge and drying wet clothes and bedding in our gas
clothes dryers. Another social contribution initiative is the “N Campaign,” inwhich Rinnai Korea donates a certain percentage of its earnings to social
welfare organizations.

Rinnai POPS Orchestra

Emergency relief in flooded area

22

CSR Report 2013│With Our Customers

With Our Customers
We provide our customers with products and services that they can use with total confidence,
so that they can lead “comfortable lifestyles.”Measures for Quality
Basic Stance on Quality
Since our establishment, at Rinnai, we have always been executing our business operations being passionate
about quality for our customers to safely use our products with peace of mind.
Indeed, our policy on quality-infused by the corporate philosophy "Quality is our destiny"-stresses efforts
to provide customers with highly safe and satisfactory products. This enduring commitment gives customers
complete peace of mind in selecting and using Rinnai products.

Basic Philosophy on Quality

Policy on Quality"Quality is our destiny"

We provide highly safe productsthat meet customers' requirements.

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

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

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

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CSR Report 2013│With Our Customers

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

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

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

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

Company-wide QC circle conference

24CSR Report 2013│With Our Customers

CS Policy
Based on our corporate philosophy “Quality is our destiny”, we handle our customers’ requests sincerely,
promptly and appropriately, and provide satisfying, assuring and reliable services and consultation to them.

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

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

The Customer Center handles requests received from customers via our tollfree number, website and other channels. In fiscal 2013, we received
approximately 970,000 calls from customers and around 4,100 comments via
our website. Results from our fiscal 2013 customer questionnaire indicated ahigh level of trust, with an overall score of 94.3.
- Ease of contacting Customer Center via toll-free number
92 points- Politeness of telephone operator
96 points

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CSR Report 2013│With Our Customers

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

The breakdown of inquiries from customers is 82% from individuals and 18% from companies.

There are the three major topics: (1) Product in use: 41%, (2) Product that a customer is considering purchasing:
38%, (3) Parts & products: 9%

Many inquiries were kitchen appliances-related. : (1) Kitchen appliances: 42%, (2) Hot-water units and bath-related
products: 31%

26

CSR Report 2013│With Our Customers

Strengthening our website capability to respond to our customers
Responding to our customers' request who would like to solve
their issues by themselves, “FAQ” is listed on our website.
In fiscal 2013, we increased the volume of information
provided via FAQ to 390 items (according to product type).
*FAQ: Frequently Asked Questions

In fiscal 2013, 78.6% people gave a favorable evaluation on our FAQ section.
We continue adding the contents to the section to be more useful to our customers.

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

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CSR Report 2013│With Our Customers

Using feedback from questionnaires to improve customer satisfaction
We ask all customers who have been on the receiving end of repair services to complete a customer questionnaire.
Covering topics such as manners during repair visits, questionnaires enable customers to rate us based on their levelof satisfaction. We then make effective use of questionnaire results by providing internal feedback on customer
comments.
The 13,000 customers who completed questionnaires in fiscal 2013 gave us an average score of over 97(*).
* Points distributed between categories by Rinnai

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CSR Report 2013│With Our Customers

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

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

Efforts to coordinate an inspection system
To adequately implement inspection, Product Inspection Center keeps improving its inspection system.
In addition to the legally required check points of an inspection system, we also set up voluntary monitoring items
to facilitate a reliable inspection system.

29

CSR Report 2013│With Our Customers[Voluntary system action items and the current status]
Action items

Rinnai’s current status

Enhancement of provisionof information

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

Enhancement of items to beinspected

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

Inspection quality
improvement

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

Warning after theinspection

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

Information about the inspection reminder function posted on the website
In November 2011, we posted information about the inspection reminder function on our website.
This function reminds users of legally mandated “specified maintenance products” of the period for theirinspections after they are used for 10 years under normal conditions. Users are reminded of the period in ways
such as a blinking light or indication on the remote control. This function also encourages users who have notsubmitted user registrations to submit them and apply for inspections.

Overview of our maintenance and inspection system

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CSR Report 2013│With Our Customers

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

Target product

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

Inspection
periodProduction Purchase9-11 years
after
production

Registration

2.5-4.5 years
after
production

1

0-6 months
in advance

Inspection
periodNotification

Inspection2

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

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

The period for legal inspection of commercial-use equipment produced in April 2009 started in October 2011, so
we began sending notices on the inspection to applicable customers. About 70% of customers who responded to
the notices applied for the inspection, suggesting their high interest in the inspection system. Accordingly, we will
strengthen measures for informing customers of the system, aiming for (1) a higher registration rate and (2) ahigher rate of inspection applications.

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

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

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

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

Dishwashers(built-in)

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

Suppliers

Owners

Always explain thesystem at time of sale ordelivery.

Listen to the explanation
about the system at thetime of purchase

Owners (and Suppliers)

Registration

Owner’s Card
(packed withproduct)

Rinnai
Mail

Online registration
Registrationof changes

By phone

Information
Management

Inspection
reminders sent
by mail toregisteredappliance owners

By card enclosed with notification
By phone

Inspection
By card enclosed with notification

On-siteinspection

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CSR Report 2013│With Our Customers

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

The scope of the safety inspection• Outdoor-type gas hot water heaters and bath water heaters(Including hot-water and heating units, and heat sources
only for heaters)• Gas heaters

Gas hot-water units
Gas bath heating systems
Gas heat source for hot-water units and heaters
Gas heat source only for heaters• Built-in-stovesGas fan heaters
Gas fan-forced heaters
Gas stove
Gas dryer

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

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

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

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CSR Report 2013│With Our Customers

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

Forming New Relationships with Customers
Harnessing the Power of the Internet to Improve Customer Support
To enable our products to be used for a long time, we sell cleaning products and parts that ourcustomers can replace by themselves via our online shopping site “R.STYLE (RINNAISTYLE).”
In fiscal 2013, the number of registered members surpassed 140,000,
opening up even more opportunities to interact with customers using Rinnai
products. We communicate with our customers through channels such as
conducting online questionnaires (18 times a year), planning products thatreflect customers’ needs based on gathered data, and resolving issues. We
will continue to increase direct interaction with our customers in the future,in an effort to improve our services.

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

33CSR Report 2013│With Our Customers

Using customers’ comments via the website to improve the company
We receive a great many comments and suggestions regarding our products andservices from customers who have used our online shopping site R.STYLE (RINNAISTYLE). We received a total of 4,994 comments in fiscal 2013. We quickly sharecustomer comments via an internal site called “Himawari Messenger”. This enables
individual divisions to examine shared information and take steps to improve quality
or broaden the scope of their services.

Strengthening relationships with our customers
In December 2011, we launched HOWARO, an online-exclusive gas stove designed to meet the needs ofcustomers across a wide range of age groups. In December 2012, one year after the launch, we brought out a newmodel and expanded our product range to reflect comments received directly from customers via our shoppingsite.

Following the launch of HOWARO, we received comments directly from customers asking for products withincreased functionality but the same simple design, directly via R.STYLE. In response to such requests, in April
2013 we launched Seiso, a tabletop gas stove combining a simple design with a wide range of features. We willcontinue to share the full range of comments and suggestions from our customers, to assist with productdevelopment in the future.

34

CSR Report 2013│With Our EmployeesWith Our Employees
We strive to create an atmosphere in which employees can be happy and productive—a corporate climate that
motivates each and every employee to do well and enables individuals to demonstrate their full potential. We alsoseek to maintain workplace environments that keep employees safe and healthy, both physically and mentally.
For our employees to be able to work with a sense of achievement and accomplishment, we provide support
through our personnel system as well as various welfare programs to take care of employees' health and cater for
their families. Moreover, for each employee to fully demonstrate his/her capability, we try to create a family-likeoffice culture, and improve and maintain our workplace to be safe, secure and healthy. We believe that the sourceof motivation for employees to grow and fully demonstrate their skills is "the provision of the opportunities toimprove" and "the sense of achievement and accomplishment". To increase the satisfaction level of ouremployees, we are promoting the following four items as our foundation:(1) Provision of opportunities for our employees to grow [Rank-specific training programs, specialization
courses, On-the-Job Training (OJT) guidance, appropriate staff allocation and rotation](2) Evaluation and reward which is fair and convincing (Performance appraisal, interview system, salary
increase and benefit improvement)(3) Creation of family-like working environment (Improvement of office building, working environment andfacilities, annual events, club activity support, and interdepartmental cooperation)(4) Welfare program for employees and their families (Welfare program options, health support, corporate
pension and events with the Rinnai Employees' Association)

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

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

35

CSR Report 2013│With Our Employees<Major Rank-specific Training Programs in Fiscal 2013>
Training

Subject

Content

Numberoftrainees
140
people128peopleNew employee
training programNew
employees

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

New employee
follow-up training

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

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

S4 level qualified
employee training

S4 levelqualified
employees

M6 level qualified
employee training

M6 levelqualified
employees

M6 level qualified
employee followup training
Performance
reviewer training

M6 levelqualified
employees
Managers whoneed toreview/intervie
w their teammembers

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

New employee training program

102
people49 people

47 people

107
peoplePresident’s speech

Career Development Review and Support
Visualizing skills of individual employees and guiding their growth (capability evaluations andfeedback of the results in one-on-one interviews)
For each training program to function effectively, it is essential to match the capability required by theorganization and the goals set by the employees.
Therefore, Rinnai prepares a "Skills Map" and a "Capability Evaluation Sheet" to define the skills
and capabilities required by each department and to clarify the goals and capabilities the company expects
the employees to achieve. Based on these tools, our employees understand their current roles and36

CSR Report 2013│With Our Employees

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

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

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

37

CSR Report 2013│With Our Employees

Comment from an Employee Stationed Overseas 1
I was assigned to Rinnai Australia from the Production Development Divisionroughly one year ago. My main duties cover a wide range of areas, including
coordinating with Japan on new product development, providing feedback on local
information, relaying technical advice from Japan, and liaising with Group
companies in other countries. There are fewer jobs that you can do single-handedly
overseas, so cooperating with related divisions is essential. I really appreciate andfeel encouraged by all the support I get from those around me on a daily basis. It’s
important to get to know one another when you’re working with people fromdifferent cultures and with different customs. Even so, I am still making new
discoveries after a whole year. I’m determined to absorb as much as possible,
however, so that I can contribute to further development in the future.
Naoya Okada, Rinnai Australia Pty., Ltd.

Comment from an Employee Stationed Overseas 2
Having been assigned to the US a year ago, I have spent most of that time
coordinating between Japan and local staff, and handling admin duties. I go toindustry fairs and visit customers, so I have had plenty of opportunities to learn about
the market and hear customers’ comments. I definitely make the most of every day. I
have become keenly aware of some of the differences between Japan and the US, interms of language, culture, customs and our ways of thinking, but working here has
confirmed that trusting relationships are every bit as important in business in the US
as they are in Japan.
I will continue to focus on relationships in the future, as I strive to become a truly
reliable member of the team over here. I will continue to stay alert too, so that canabsorb as much knowledge and information as possible.
Kazuchika Ito, Rinnai America Corporation

Comment from an Employee Stationed Overseas 3
Having continued to studiously learn about manufacturing as part of the die
production process during the 12 years I have been with Rinnai, I have now been
assigned to Brazil. As a technical advisor, I am currently serving in a supporting role,dealing with development, production technology and manufacturing. Working in
manufacturing in another country, faced with differences in language, culture,
customs and techniques, I am making the most of the experience I built up in Japan,
based on the notion that “if you know what is right and do nothing, you lackcourage.” I encounter things that I don’t understand on a daily basis, both inside andoutside work, but I also do things like going cycling with my colleagues and am
constantly being helped along by the uniquely friendly people here in Brazil. I
always have the same grand ambition in mind – to share Rinnai’s hot water culture
and help improve people’s lifestyles throughout South America! I am determined tokeep on growing one step at a time with my local colleagues, so that I can become an
outstanding engineer.
Kenji Miyakoshi, Rinnai Brazil Heating Technology Ltd.

38

CSR Report 2013│With Our Employees

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

Training

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

Employee conduct display(Oguchi Factory)

Coating training station(Seto Factory)

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

Studying the structure ofdish washer

Studying the structure ofplug of gas appliances

Studying about gas combustion

39

CSR Report 2013│With Our Employees

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

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

Child nursing leave

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

Extended family careleave

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

Childcare shortened
work hours

Fiscal
2013

Fiscal
2012

42

47

57

33

2

2

2

0

0

0

0

0

Family care leave

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

Work from home
program

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

12

Come Back program

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

00Measure to reduce
working hours (Flexible
working hours)

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

Measure to reduce
working hours (Noovertime day)
Measure to increase theratio of consumed paidleave

Every Wednesday is set as “No overtime day” to encourage
employees to leave early.

Production
divisionsManagement
divisionsApplicable tocertaindepartments

To promote the utilization of paid-leave, we encourage employees
to take at least one day per each half fiscal year, total 2 days ayear, as "Refreshing paid-leave"

Applicable to all
departments

Family-care shortened
work hours

40

CSR Report 2013│With Our Employees

Measures to Enrich Our Employees’ Family LivesThe Rinnai Employees’ Association is the lead organizer of courses for employees on the themes “Education
for the Soul” and “Passion for Life.” These courses are intended to prepare people for the different stages
that life will take them through, with a focus on ethics, communication skills, life planning and money
matters. Of the firm belief that a positive perspective on work is essentially a reflection of a happy home life,
we encourage employees to take advantage of opportunities, such as barbecues and sports days, where they
can gather as families with families. These events foster a sense of harmony among colleagues.
<Major Programs in Fiscal 2013>
Item

Overview

Nationwide events in Japan

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

Training seminars by age group

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

Nationwide Events
Chubu Sports Festival (Oguchi Sogo Ground)
Walking Festival (Higashiyama Zoo)
Kanto Festival (Kasai Rinkai Park)
Kansai Festival (Expo ’70 Commemorative Park)
Nationwide event (Barbecue) Sapporo, Tohoku, Niigata, Shizuoka,
Hiroshima and Kyushu

Number of participants
1,664
1,448
179
197
Total 571

30th Walking Festival
This annual walking event is designed to let
employees enjoy time with their families and raise
their awareness of health. The venue this time wasthe Higashiyama Zoo and Botanical Gardens where,
under the theme of “biodiversity,” participants
enjoyed environmental quizzes and games while
walking the 10,000-step (approx. 4.1 km) course. A
total of 1,448 employees and family members
participated in the 30th annual event.

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

Personality design seminar

Number of participants
80
59
88
136

New employee communication

41

CSR Report 2013│With Our Employees
seminarIndustrial Relations and Human Rights
At the Rinnai Group, aiming to provide the work environment and culture that employees can feel as "I am happy
to work at Rinnai.", the Rinnai Employees' Association and Personnel Affairs Division regularly convene theLabor-Management Council to confirm and share the information on management policy, actual results, andcomments from each workplace as a periodic improvement activity.
Moreover, our basic stance toward human rights, the respect for each other's personality and theprevention of harassment is compiled as "Rinnai Code of Ethics" to educate and enforce all employees in theGroup. In addition, we also established the Corporate Ethics Helpline to maintain the sound environment of theworkplaces.

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

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

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

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

42

CSR Report 2013│With Our Employees

Increase in the Allocation/Promotion of Female Employees(1) Current status of positions held by female employees
The ideas and comments from women are very important to our products. Many women are demonstrating
their capabilities in various roles, demonstrating their strengths especially in the product planning department,
sales planning promotional department, fixed customer sales department and production department.
Moreover, the ratio of women in total generalists (core job positions) is also increasing every year and theCompany actively assigns women to management positions.
In Japan, as of April 2013, the Company had 55 female managers (2.4% of total managing positions), doubling
the number in 2006.
(2) Enhancement of Support Programs for Working Women
For women to keep working for the Company after getting married, we provide various working styles andsupport programs.
<Major Programs>(i) Career track conversion system
A system which allows employees to convert from generalists to clerical employees (when they do notwish to relocate for job assignment or if there is a request for shortened working hours), or from clericalemployees to generalists (because of superior work performance)(ii) Reemployment system (Come Back Program)A program that enables former employees to return to work as a full-time employee(iii) Childcare leave and Family care long leave
Programs to support employees to raise children(iv) Shortened work hour system
A program to support employees to raise children and care their family members(v) Flexible working hours system
A program to support employees to raise children, care their family members(vi) Work from home program
A program to support employees to raise children, care their family members and recover from diseases

Fair and Diversified Employment
View toward Employment
We respect the diversity of individuals and provide employees with various job opportunities and a working
environment where they can demonstrate their various capabilities.
Rinnai Group Code of Ethics stipulates that "Any discriminatory act toward an individual based on
gender, age, nationality or physical characteristics, etc. is prohibited". Based on this, we maintain fair andequitable hiring practices, in line with prevailing business plans and recruitment needs.
In addition, we actively engage in mid-career hiring to capitalize on the accumulated experience andknowledge of individuals who showed they can make a contribution to our success. We hire about 40 mid-career
skilled employees every year.

43

CSR Report 2013│With Our Employees

Reemployment of Retired Employees and Support for Demonstration of their
Abilities
Rinnai promotes a reemployment program for employees who retired due to the age limit in order to continuously
utilize technology and skills that skilled employees possess and to smoothly pass on the skills and the Rinnai
Spirit to following generations. There are currently 160 employees working under this program.We offer one-year
contracts until the age of 65, with a choice of three options, enabling employees to work full time, alternate daysor reduced hours, to fit in with a wide range of individual lifestyles.
This reemployment program provides employees with purpose and motivation in life as a leader/mentor
and maintains and improves the corporate culture and dynamics within the workplace.

Promotion of recruitment of handicapped employees
Since fiscal 2009, we have promoted recruitment of handicapped employees in a planned manner by cooperatingwith the public employment security office and schools for the disabled. In the initial year, the employment rate ofpersons with disabilities at the Company was only 0.79%, so out of a sense of social responsibility (sense ofurgency) we took a more active stance toward recruiting handicapped people.
In July 2008, the public employment security office greatly assisted us with recruitment of handicappedpeople. The office allowed us to hold an exclusive job interview meeting at which we interviewed a total of 28
applicants and employed 15. We later began to recruit new graduates from schools for disabled students andimplemented an internship program for second-year students of those schools. The number of newly recruited
disabled employees has been increasing each year.
The Customer Center we established in fiscal 2011 has toilets and ramps for wheelchair users, andbarrier-free elevators; thereby improving the Company’s internal facilities for handicapped employees. The
employment rate of persons with disabilities at the Company has consequently been significantly improved to
1.71%. We will continue to promote recruitment activities and improve the workplace environment towardachievement of the legally mandated minimum employment rate of 2.0%.

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

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

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

44

CSR Report 2013│With Our Employees

Status of On-the-Job Accidents and Injuries
In fiscal 2013, we made efforts to achieve the goal of zero accidents under the Rinnai Companywide Health and
Safety Committee, serving as the administrative organization of Group companies in Japan. Unfortunately,
however, we recorded a total of 36 on-the-job accidents (five more than in the previous year).
Broken down by division and percentage, 29 of the accidents took place in production divisions (93%),
five occurred in sales and marketing divisions (7%) and two occurred in research and development division. The
most frequent were as follows.
1st: Cutting hand, arm, leg, or foot from contact with equipment or material: 11 cases (31%)
2nd: Cutting or bone fracture of a body part caught in equipment, jig, or tool: 8 cases (22%)
3rd: Bone fracture of hand, arm, leg, or foot due to fall: 4 cases (11%)

In response, under the improvement plan for fiscal 2014, we will comprehensively review what protective gear towear at each workplace and for each type of work, establish rules and standards based on the results of the review,
and make it a top priority to comply with the rules and standards.
With regard to the on-the-job accidents occurring in the previous year, each Group company will as soon
as possible take measures for preventing their recurrence. The entire group will thus make concerted efforts toensure prevention of accidents toward achieving the goal of zero accidents.

Accident Prevention Measures
To give our No.1 priority to work safety and peace of mind, the Group promotes various accident prevention
measures under the guidance of the “Risk Management Committee” headed by the President.
With the rising frequency of large-scale disasters at home and abroad, the Rinnai Group, aiming to build astrong corporate structure to withstand crisis situations, establishes business continue plans for a quick recovery at
the time of disaster.
(1) Activities to prevent fire and explosion: Enforcement of safety inspection of environmental safety equipment(gas feeders and furnaces, etc.) and test and evaluation equipment, and the improvement and renewal ofequipment as our top priority(2) Reduction of risk of earthquake damage: Preventing objects in factories and office buildings from falling over,
dropping, and scattering(3) Production site onsite guidance: Horizontal development of the production sites under the guidance of the
Safety and Health Committee of Production Group(4) Training for clerical work staff and new employees: KYT training for new employees including a monthly
information sharing session regarding on-the-job accidents, designed to promote work-safety awareness.
(5) Implementation of emergency drill: "Earthquake and fire drill" more than once a year
*KYT: Kiken Yochi (danger prediction) Training

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

Emergency drill

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CSR Report 2013│With Our Employees

Promotion of Traffic Safety
To minimize traffic accidents involving employees, various measures and education programs are provided. We
apply to the Japan Safe Driving Center, and obtain a certificate of driving record for each employee who isgranted permission to drive a company car or commute by car. This is to accurately gauge the number of
employees’ traffic accidents and violation of traffic rules to improve self-awareness for compliance. In particular,
it is mandatory for employees in sales divisions to report accidents and violation of rules. Depending on thedetails, an employee may receive a suspension of the permission to drive a company car or may require
taking a safety seminar provided by an external agent.
In addition, we introduced a safe driving “eco-drive” promotion system into company cars to check daily driving
records. This system contributes to fuel efficiency and environmental awareness, in addition to improved
consciousness of safety issues.
Moreover, new employees receive an actual driving lesson using a company car, receiving instruction from adriving school, a program which encompasses risk anticipation training using video, education of traffic rules andregulations and an aptitude test to improve their awareness of safe driving.

Driver education at a driving school

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

Support for Health Promotion
Through the alliance with the Rinnai Health Insurance Society, we provide a range of medical support
services to our employees and their dependent families which include regular checkups as well as detection
examinations for various types of cancer (including prostate, intestinal and breast cancer checks). Thoroughphysical examinations are also available. For patients with lifestyle diseases, specific health guidance and an
individual follow-up are provided to make sure the employee is fully recovered.
For physical fitness, we are also eager to financially support sporting events organized by the employee
union and voluntary club activities for employees all over Japan (23 clubs including soccer, baseball, golf,
cycling, table tennis, bowling, and distance running) to promote employees’ health.

46

CSR Report 2013│With Our Employees

Mental Health Care
We make every effort to maintain sound workplaces by caring for the mental
health of our employees, focusing particularly on preventive measures andearly stress detection. In fiscal 2013, we organized three different courses; astress self-care seminar to help employees diagnose and deal with day-to-day
stress, a basic seminar for managers to teach them how to manage and handle
members of staff, and a practical seminar for managers focusing on group
work. With 22 seminars across the three courses, a total of 428 employees
attended. We have also introduced an external mental health care service that
employees can consult regarding concerns within their local community or athome, as well as individual concerns in the workplace.
Mental health care workshop

Outline of our Education System

Managerial supervisor
Line care

Education programs for all employees
New employees
When joining the company; once

Basic program

Applied program

Self management
All employees

Self care

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

External care

Industrial doctors, health supervisors, labor managers, Personnel Affairs Division, etc.

Internal care

Joining the Company

Retirement

Human Resource and Personnel Related Data
We disclose human resource and personnel related data including the number of employees and the status of fulltime
employees.
Number of full-time employees (consolidated, year-end)
Fiscal 2011

Fiscal 2012

Fiscal 2013

(At March 31, 2011)(At March 31, 2012)(At March 31, 2013)

Male

2,449

2,471

2,517

Female

1,116

1,114

1,111

Domestic Group
Companies

Male

1,061

1,069

1,099

Female

590

578

582

Overseas Group
Companies

Male

2,170

2,326

2,361

Female

1,008

1,120

1,154

8,394

8,678

8,824

Rinnai Corporation

Total

47

CSR Report 2013│With Our Employees

Number of full-time employees by region (consolidated, year-end)
Fiscal 2011
Fiscal 2012

Japan

Asia excluding Japan

North America, andEuropeOther(Oceania, SouthAmerica)

Fiscal 2013

Composition(At March 31, 2011)(At March 31, 2012)(At March 31, 2013)

Male

3,510

3,540

3,616

-

Female

1,706

1,692

1,693

-

Sub-total

5,216

5,232

5,309

60.2%

Male

1,756

1,876

1,923

-

Female

828

908

957

-

Sub-total

2,584

2,784

2,880

32.6%

Male

100

103

74

-

Female

36

35

35

-

Sub-total

136

138

109

1.2%

Male

314

347

364

-

Female

144

177

162

-

Sub-total

458

524

526

6.0%

8,394

8,678

8,824

100%

Total

Number of employees (non-consolidated)

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

Fiscal 2011

Fiscal 2012

Fiscal 2013

(At March 31, 2011)(At March 31, 2012)(At March 31, 2013)

107
41
8
22
13.4
35.2
2.8
34.9

82
54
11
17
13.7
35.7
2.2
37.5

102
61
15
13
13.7
35.3
2.0
36.2

1.42

1.65

1.71

49

47

42

24

33

57

0

2

1

29

31

36

4.4

4.4

6.6

48

CSR Report 2013│With Our Shareholders and Investors

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

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

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

General Shareholders’ Meetings
We held the general shareholders’ meeting for our 63rd term at the Meitetsu New Grand Hotel in Nakamura-ku,
Nagoya on June 27, 2013. To encourage more shareholders to get involved in discussions and attend the meeting,
we send out notices to convene earlier than the legally required date. We also include photos, graphs, explanations
and other such content in our shareholder reports, which we send to all of our shareholders, to make our resultseasier to understand.

Communication with Institutional Investors and Analysts
In addition to biannual presentations outlining our results,
we discuss our performance and actively exchange
opinions with institutional investors and analysts throughactivities such as small meetings, visiting individual
investors and accepting telephone interviews. We also takepart in conferences organized by securities firms, in aneffort to expand our IR activities. We organize factory
tours every year as an opportunity to provide a better
understanding of our commitment to monozukuri(manufacturing).
49

CSR Report 2013│With Our Shareholders and Investors

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

Our Policy on Dividend
One of our top management priorities is to sustain a stable returnof profits to shareholders. Several factors play into the calculationof dividends, such as consolidated performance, return on equity
and financial status.
Seeking to enhance corporate value, management looks atretained earnings with a view to the long term, effectively applying
this source of capital toward R&D, capital spending andinvestments accompanying the expansion of sales at home andabroad.
The annual dividend for fiscal 2013 was ¥60 per share, up¥4 per share from fiscal 2011.
This marked the 11th consecutive year of higher dividends.

Share Information
Share Information (As of March 31, 2013)
Number of authorized shares: 200,000,000 shares
Number of outstanding shares: 54,216,463 (Including treasury stock)
Number of shareholders: 3,871

Inclusion in SRI Index
Socially responsible investment (SRI) is a method of selecting investments by
evaluating companies based on their social, ethical and environmental performance, in
addition to conventional investment criteria based on financial analysis and growthforecasts. We have been selected for inclusion in the FTSE4 Good Global Index, aworldwide SRI index, for nine consecutive years since 2004.
*FTSE is an index calculation and management company wholly owned by the London Stock Exchange. FTSE indexes
are widely used by investors all over the world, for purposes such as analyzing investments, evaluating results andmanaging assets.
*The FTSE4 Good Global Index is one of the leading indexes for socially responsible investment. It was set up in 2001
by the FTSE Group, which selects companies that meet international standards for corporate social responsibility(CSR).

50

CSR Report 2013│With Our Business Partners

With Our Business Partners
We disclose fair and impartial information in a timely and appropriate manner, and through open channels toshareholders and investors we pursue investor relations (IR) activities that foster greater trust.

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

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

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

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

Communication with Our Business Partners
We request our business partners to independently establish a quality assurance system and assure theimplementation of the system to help us achieve our policy on quality, “We provide highly safe products that meetcustomers’ requirements.”
We provide opportunities for suppliers to learn more about our perspective on quality and the basis of monozukuri
51

CSR Report 2013│With Our Business Partners

at Rinnai through annual events including a get-together at the beginning of the year and policy information
meetings and regular meetings of the Supplier Liaison Group. These meetings are also ideal for gathering
information through suggestions from suppliers and promoting dialogues based on submitted questions. Indeed,
these meetings promote a stronger commitment to teamwork.
In terms of online information disclosure tools, we continue to operate our existing one-way communication tool
“R-TALK” and have also launched an interactive tool called “R-LINE.” We are working to improve userfriendliness even further, evolving from tools that are “used” to tools that are “usable.”
We also promote green procurement processes with an emphasis on environmentally friendly supply chain
management. We formulated E-Procurement Standards and work together with our business partners to pursue
monozukuri with an environmental conscience. This includes implementation of proper environmental management
and environmentally friendly approaches toward materials as well as parts production and use. We have also
introduced controls for chemical substances contained in materials and parts, in accordance with the Chemical
Substance Management Rank Guidelines for Products*1.
*1: Policy to eliminate or reduce the use of six substances listed in the Reduction of Hazardous Substances (RoHS) Directive

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

Level-Up Workshop

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

Promotion of Acquisition of ISO9001 and ISO14001 Certifications
To ensure provision of high-quality, safe, environmentally friendly products, all our domestic factories acquired
ISO9001 certification (for quality management systems) and ISO14001 certification (for environmental
management systems).
We also ask our business partners to understand our approach to quality and the environment and toobtain ISO9001 and ISO14001 certifications or establish equivalent management systems, and we help them
operate the systems.
In addition, we use our online tool “R-LINE” for the purpose of chemical management, and ensure
rigorous management by updating information on timely basis.
52

CSR Report 2013│With Our Business Partners

Working with Logistics Partners to Improve Logistics
Integrated Logistics CenterAt our Integrated Logistics Center, we are working to establish a streamlined logistics
system linked to both production and sales, in an effort to improve the quality oflogistics and services.
We are receiving more orders for system products and there is a greater demand for awider variety of products with smaller lot sizes. Moreover, we need to cope with morediversified requests from our customers such as shortened lead time before thedelivery, and a delivery to locations where the product must be actually installed.
Previously, we stored products in a distributed fashion across up to 14 logistics centerin Aichi, where our production is mainly based. Today, however, due to the results of acompany-wide effort to reduce inventories, we have managed to consolidate ourlogistics bases into two. This has boosted logistics efficiency and contributed to a
reduced environmental burden.
The Integral Logistics Center has introduced item-by-item control with QR
code and an inspection system. QR codes, which identify each product, are affixed to
all products and utilized in many processes in the logistic centers such as when
products are brought in and out. By reading the data of QR code, we have drastically
improved the quality of logistics by preventing errors and improving the traceability ofeach item. In addition, the combined use of wireless terminals, real-time operation
instruction and actual result collection resulted in a significant improvement of theoperations.
In August 2013, we established the Iwakura Logistics Center, as a central
warehouse for smaller items. Integrating management of auxiliary and optional items
will enable us to combine shipments for parts that had previously been delivered
separately, thereby improving the quality of customer delivery services and increasing
efficiency. Being located next to a central parts warehouse will also improve transport
efficiency within the group and help to optimize operations as a whole.

Integral Logistics Center

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

Communication with Logistics Partners
Every April, we hold a logistics policy information meeting to help service providers gain deeper insight into thelogistics policy, targets and measures of our company and logistics department. In addition, we arrange a quarterly
quality conference to reduce environmental burden related to the transportation and storage of products, and to
improve the quality. We also visit their working sites regularly to share issues with them and help them make
improvements.

Our Logistics Partners’ Measures to Improve their Logistics Quality
In May 2010, eight mixed consignment carriers* of our logistics partners voluntarily established a “Logistics
Working Group” for quality improvement. To promote the improvement of logistics quality and safe
transportation, the Working Group is tackling the issues that are common with mixed consignment carriers
through information exchange and improvement activities with the leadership of onsite staff. In fiscal 2013, theWorking Group implemented specific measures such as regular visits to premises where cargo is shipped or
received, creation of awareness posters, and countermeasures against incorrect deliveries. The Working Group iscontributing to the improvement of the logistics services of our company as well as the performance level of eachcarrier.
*Mixed consignment carrier: Services to transport consignment collected from any number of consigners, or an operator that offers theservices.

53

CSR Report 2013│With Our Business Partners

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

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

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

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

Fiscal
2008

Fiscal
2009

Fiscal
2010

Fiscal
2011

Fiscal
2012

Fiscal
2013

7,042

6,519

6,483

6,333

6,687

6,587

11,22810,013

9,901

9,837

10,23810,44054

CSR Report 2013│With Our Communities and SocietyWith Our Communities and Society
We actively, voluntarily and continuously engage in a wide range of activities aimed at contributing to society
throughout the Rinnai Group. We carry out activities in close cooperation with local communities all over theworld.

In Touch with the Community
Visiting an Elderly Welfare Facility
In September 2012, employees from Rinnai Brasil Heating Technology Ltd. visited a welfare facility for the aged,
Pro+Vida in Mogi das Cruzes. Members of staff donated adult diapers, food and other items, and enjoyed talking
to residents at the facility

Mountain Climbing for Charity
In July 2013, Rinnai UK Ltd. organized an event in which employees andmembers of their families climbed up Snowdon, a 1,085-meter mountain in
Wales, carrying a water heater. The aim of the event was to raise ￡2,000 to
donate to a non-profit organization called Ciaran’s Cause.

Support for the Restoration of the Nakagawa Canal
The Nakagawa Canal that runs near our headquarters used to be alive as a transportation route for foreign ships
connecting the Port of Nagoya and the center of Nagoya city. With the development of transportation by railroads
and automobiles, the utilization of canal transportation diminished greatly. In 2010, the Nakagawa Canalcelebrated the 80th anniversary of its creation. To commemorate, an art event, “The Nakagawa Canal Art”, washeld in every October from 2010 based on a plan to restore the Nakagawa Canal as the new core of the Nagoya
city. The Nakagawa Canal was used as the stage for a number of events, including a performance bychoreographer Nobuyoshi Asai, a recital by children from a local violin school and magical candlelightilluminations along the canal. As a local company, we are providing our support for a joint governmentcommunity-industry project to restore the Nakagawa Canal. In fiscal 2013, we also decided to donate a total of￥100 million to the Nakagawa Canal Restoration & Cultural/Artistic Activity Assistance Project. We willcontinue to work with local residents to utilize and restore the Nakagawa Canal, and to promote community
development activities.

55

CSR Report 2013│With Our Communities and Society

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

The Nakagawa Canal

The Nakagawa Canal by
candlelight

Participants decorating candles

Support for fund raising for cystic fibrosis patients
Rinnai America Corporation leant its support to the March of Dimes Walk in
April 2012 by providing £3,000 in sponsorship. Employees and family
members also took part in the event, which is part of a support program for
pregnant mothers and babies.
March of Dimes Walk

Participation in the program of “Habitat for Humanity” and “Happinesssharing ‘N’ Campaign”
The Habitat for Humanity movement in South Korea started during the latterpart of the 1980s, as a volunteer project aimed at building houses for thehomeless. Rinnai Korea Corporation has been supporting activities every year
since 2009, providing gas stoves for all families moving into Habitat homes
nationwide. We donated a total of 96 gas stoves in 2012, for new andrenovated homes in Seoul, northern Kyonggi, Daegu, Chuncheon, CheonanAsan and Kunsan.
We have also signed up to the “Happiness-Sharing N Campaign” organized by
the Korea National Council on Social Welfare (a support scheme wherebycompanies save around 1% of the proceeds from sales of products and services
certified with the “N mark”, as a symbol of sharing, in a fund and provide a
portion of their sales revenue to social welfare organizations in need ofsupport). Our own “Happiness-Sharing N Campaign” fund, consisting of a
portion of revenue from gas stoves sold during the year, reached a total of 30
million won, which has been used to replace hot-water units and gas stoves, rehang wallpaper, and refit boards, to improve living conditions for the lessfortunate.

56

CSR Report 2013│With Our Communities and Society

Disaster-prevention and crime-prevention activities for local communities
Each Rinnai Group location actively cooperates with disaster-prevention andcrime-prevention activities by the local government and community. In fiscal
2013, 10 employees from our Seto Factory took part in the Seto City Fire
Department New Year Parade (Aichi prefecture).

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

Seto Factory

Asahi Factory

Acceptance of high-school student trainee
The Rinnai Group cooperates with internshipprograms by each year proactively accepting highschool students as interns at its offices and factories.

Seto Factory

Noto Tech Co., Ltd.

57

CSR Report 2013│With Our Communities and Society

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

Rinnai Corporation, Actual Results in Fiscal 2013

Major financial contribution* Foundation for the Arts, Nagoya* Chubu High-tech Center (CHC)* Japan Academy of Chamber Music*The Nakagawa Canal Art*Nakagawa Canal Restoration & Cultural/Artistic
Activity Assistance Project*Japanese Red Cross Nagoya Daiichi Hospital

Major sponsorship* Japan Virtuoso Symphony Orchestra Concert* “Kamikaze,” opera by Shigeaki Saegusa* Nagoya Philharmonic Orchestra* Nagoya School of Music, The Music Competition of Japan,
Award-winning Celebration Concert* Campus Venture Grand Prix, Chubu Area
* Nagoya Shonen Shojo Hatsumei Club (Invention andInnovation Youth Club)* Toyota International Youth Football Championship* Nippon Domannaka Festival* TALK-TCS (Table Coordinator Standards)“Eat Together at Noritake Garden”

Support for the World’s Largest Long-Distance Relay
Rinnai America Corporation supported Ragnar Relay, the longest relay
in the world that takes up to 12 runners to finish a course of about
300km in the U.S, by installing shower rooms at two staging points andthe goal point.

The Ragnar Relay

Rinnai POPS Orchestra Program“Rinnai POPS Orchestra” operated by Rinnai Korea Corporation, isthe only one private orchestra in Korea. It was established in 1986 forthe emotional development in the youth, the contribution for thegrowth of culture in the local community and the improvement of thelevel of culture of the nation. The orchestra provides charity concerts
including a regular concert and concert trip visiting various sites
based on requests and invitation. In 2011, the orchestra held 28
concerts.

58

CSR Report 2013│With Our Communities and Society

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

From the left: activities around Yanagisawa Manufacturing Co., Ltd.,
the Asahi Factory, Rinnai Technica Co., Ltd., and RT Engineering Co., Ltd.

Participating in a Tree-Planting Ceremony at a New HospitalIn fiscal 2013, employees from Rinnai Technica Co., Ltd., took part in atree-planting event at the Chutoen General Medical Center, part of the“Saving Lives: Planting Trees of Hope Project” organized by Kakegawa
City in Shizuoka prefecture.

Blood Donation Program
RB Controls Co., Ltd., runs a “Give Blood for Love” blood donation
campaign twice a year, in August and February. There are always atleast 100 employees willing to take part.

59

CSR Report 2013│Environmental Policy

Environmental Policy
We engage in environmentally friendly initiatives across all of our business activities, in line with our Basic
Environmental Policy, to help create a sustainable society and a sustainable planet.
Ever since Rinnai was established, our corporate mission has always hinged on “the use of heating toprovide society with comfortable lifestyles.” Drawing on our expertise in maintaining harmony between heating
and lifestyles, built up over many years, we have always striven to protect the environment and contribute tosustainable development. At the same time, we recognize that our wide-ranging activities are inextricably linked
to the environment and have made it one of our top priorities to care for the environment through our core
operations.

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

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

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

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CSR Report 2013│Environmental Policy

Basic Environmental Activity“7E” Strategic Initiatives: Green Activities Involving All Employees in All Business Areas
Based on our goal to achieve a sustainable operation, we have been promoting the “7E” Strategic Initiatives.
The employees with a high sense of environmental awareness create environmentally conscious products atgreen factories to provide these products to customers with our confidence. As a monozukuri-driven
company, we pay considerable care to the entire lifecycle of our products—from product development toprocurement of materials and components and on through production and then sales, use and disposal. Ourconsideration goes to each element including “procurement” of materials and components, “factories” as thebase of our monozukuri, “sales” of our products, “services” related to the products used by our customers,"offices”, where administration activities take place and “employee”, the foundation of our activities.

61

CSR Report 2013│Environmental Policy

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

Basic Philosophy on the Environment
To underpin the systematic and continuous development of environment-oriented activities in line with our statedbasic environmental policy, we encourage all members of the Rinnai Group to embrace efforts to acquire andmaintain ISO14001 certification. In fiscal 2013, we obtained ISO 14001 certification at two sales divisions inJapan (Tohoku Branch and Shikoku Branch) and at one overseas company (Rinnai New Zealand). To further
expand our environmental protection activities, we will continue to promote introduction of environmental
management systems to our domestic sales operations and overseas Group companies.

Domestic Offices

Tohoku Branch

Shikoku sales office

Overseas Office

Rinnai New Zealand Ltd.

Certification acquisition status[ISO 14001: 2004] Environmental management system certification acquisition status
Location

Rinnai

Certified year/month

Research and Development Headquarters

October 1997

Production Engineering Division

October 1997

Oguchi Factory

October 1997

Seto Factory

December 2000

Environment DivisionDecember 2000

Aichi Factory

November 2003

Asahi Factory

November 2003

Quality Assurance Headquarters

November 2003

Head Office

December 2008

Kansai Branch

May 2010

Logistic Control Office

May 2010

Kanto Branch

May 2011

Chugoku sales office

May 2011

Parts CenterMay 2011
62

CSR Report 2013│Environmental Policy

DomesticGroup
Company

Overseas
Group
Company

Kyushu Branch

April 2012

Hokkaido sales office

April 2012

Niigata sales office

April 2012

Tohoku Branch

May 2013

Shikoku sales office

May 2013

Rinnai Technica Co., Ltd.

December 2003

Yanagisawa Manufacturing Co., Ltd.

June 2004

Rinnai Precision Co., Ltd.

December 2005

Japan Ceramics Co., Ltd.

January 2006

RT Engineering Co., Ltd.

March 2006

RB Controls Co., Ltd.

March 2006

Noto Tech Co., Ltd.

January 2007

Rinnai Korea Corporation

July1997

RB Korea Ltd.

October 2006

Shanghai Rinnai Co., Ltd.

December 2008

Rinnai Brasil Heating Technology Ltd.

June 2011

Rinnai New Zealand Ltd.

July 2013

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

Techno Parts Co., Ltd.

Certified year/month
August 2011

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

63

CSR Report 2013│Environmental Policy-1

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

Review meeting by executives (left)
and liaison group meeting

Environmental Audits
External Audits
The ISO 14011 Certification Division undergoes a routine audit, once a year, by an external screening/registrationbody to verify that the environmental management system is being properly applied. The routine audit in fiscal
2013 did not turn up any major non- conformances.

External audits: from the left, Technology Development Center (two photos),
Yanagisawa Manufacturing Co., Ltd., and RT Engineering Co., Ltd.

Internal Audits
As part of internal audits, Auditing team, comprising impartial internal auditors chosen from within the
Corporation who have no direct connection to the division under audit, assess conformity to the establishedenvironmental management system and review division activities. Auditors visit worksites of divisions tapped foran audit and perform detailed inspections. Direct contact between auditors and divisions facilitates greater
understanding of division activities and auditor concerns. Internal audits in fiscal 2013 found no major nonconformances. There were 12 opportunities for improvement and 42 observations. We swiftly addressed theseareas to ensure that they would not develop into problems later on.

Internal audits: from the left, Oguchi Factory (two photos), and RT Engineering Co., Ltd.

64

CSR Report 2013│Environmental Policy-1

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

Environmental training
for new employees(Rinnai Precision Co., Ltd.)

General environmental training
for employees handling food
(Asahi Factory)

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

Internal audit workshops (left) andseminar on ISO 14001 standards

61

Seminars on ISO 14001 standards (external instructor)

32

Environmental Training for Trainees from Overseas Group Companies
A range of materials are used for training on topics such as approaches to the environment and basics ofenvironmentally friendly monozukuri. Trainees are also given onsite training on methods of production withenvironmentally friendly facilities and methods of improvement based on case examples. We strive to improve theenvironmental awareness level of the entire Rinnai Group.

Trainees attend a lecture on
our environmental
initiatives

Explanation ofwastewater treatment
facilities

Trainees receive
explanations on our water
recycling system

65

CSR Report 2013│Environmental Policy-1

Training in Biodiversity and How It Relates to Rinnai
In addition to our own business activities, we also use large quantities of resources andenergy when our products are used and disposed of by our customers. We have always
emitted greenhouse gases such as CO2, too, and other substances that impact on theenvironment.
We organize training in biodiversity for environmental members of staff, so that theyrecognize how biodiversity relates to our business activities and can focus on stepping
up preservation initiatives.
Frequency: Four times a year

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

Rinnai’s Procurement Management
Standards

E-Procurement Standard [Ver.3] (left)
and Policy on Chemical SubstanceManagement [Ver.3]

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

Practical training(Shanghai Rinnai Co.,Ltd.)

Support to Establish Environment Management System
To promote environmentally conscious monozukuri working with our business partners, we encourage ourbusiness partners to obtain certifications for environment management system including ISO14001, Eco Action
21 and KES.
66

CSR Report 2013│Environmental Action Plan and Results

Environmental Action Plan and Results
Fiscal 2013 (Year ended March 31, 2013) Environmental Action Plan and Results
This section outlines targets and results for key activities in fiscal 2013 - environmental management and the 7Es(E-Products, E-Procurement, E-Factory, E-Marketing, E-Service, E-Office and E-Mind) - and assesses progress
towards the relevant targets.
*Progress rating○: Achieved△: Not achieved

×: Not implemented

Activity

Fiscal 2013 Target

Fiscal 2013 Achievement

Progress

Environmental
management
system• Obtain ISO 14001 certification at
one branch, one sales office and one
overseas facility• Obtained ISO 14001 certification at threefacilities - two domestic (Tohoku Branch,
Shikoku Sales Office) and Rinnai New
Zealand○

Fiscal 2013 Target

Fiscal 2013 Achievement

Progress

E-Products
Activity

Prevent global
warming• Continue to develop low-NOx hotwater systems• Developed low-NOx hot-water units- Eco-Jozu hot-water units- Eco-Jozu bathtub filling units- Heat source for Eco-Jozu hotwater/heating system○• Continue to carry out productassessments• Carried out product assessments(Coverage: All new products)○• Develop lightweight products• Developed lightweight products- Heat source for Eco-Jozu hotwater/heating system- Eco-Jozu bathtub filling units- Bathroom heater/dryer/clothes
dryer- Built-in gas stove for the ASEAN
market○Fiscal 2013 Achievement

Progress

Saving andrecycling
resources

E-Procurement
ActivityGreenprocurement

Fiscal 2013 Target• Achieve 100% green supplier rate
across major suppliers• Green supplier rate: 98.5% (onecompany outstanding)• Develop green products• Procured and used materials inaccordance with E-Procurement
Standards• Implement green procurement
management• Laid foundations for chemical
management and reinforced cooperation
with suppliers

△

○

67

CSR Report 2013│Environmental Action Plan and Results
E-Marketing, E-Service
Activity

Fiscal 2013 Target

Fiscal 2013 Achievement

Progress

Increasing salesof high-efficiency
products• Reduce CO2 emissions from highefficiency hot-water units by atleast 49,000 tons/year• Cut CO2 emissions from high-efficiency
hot water units by 36,000 t-CO2/year△

Providinginformation on
environmentallyconscious
products• Showcase and raise awareness of
products at exhibitions• Showcased and raised awareness of
products at exhibitions• Produce and distribute catalogs,
flyers and pamphlets• Produced and distributed catalogs, flyers
and pamphlets○

E-Mind, Other
Activity

Fiscal 2013 Target

Fiscal 2013 Achievement

Progress• Publish CSR Report for fiscal
2013• Published CSR Report for fiscal 2013
(September)• Disclose environmental
information on website• Disclosed environmental information on
website (September)• Promote educational activities inline with companywide and sitespecific plans for fiscal 2013

• Provided environmental training for new
employees, training for internal auditors,
etc.
• Improved understanding of how ouroperations affect biodiversity, throughenvironmental education, events, etc.

○

Fiscal 2013 Target

Fiscal 2013 Achievement

Progress• CO2 emission factor*1
Reduce by 3% or more comparedto fiscal 2010

• CO2 emission factor
Reduced by 7.6% compared to fiscal 2010△

•Maintain zero emissions:(Resource recycling rate of 99.5%
or higher)• Waste emission factor:
Reduced by 9.3% compared to fiscal 2011

•Waste emission factor*2:
Reduce by 2% or more comparedto fiscal 2011

• Waste emission factor:
Reduced by 9.3% compared to fiscal 2011

Reducehazardous
chemical
substances• Hazardous chemical usage
factor*3:
Reduce by 2% or more comparedto fiscal 2011

• Hazardous chemical usage factor:
Reduced by 3.2% compared to fiscal 2011○

Reducing water
consumption• Water consumption factor*4:
Reduce by 2% or more comparedto fiscal 2011

• Water consumption factor:
Reduced by 15.8% compared to fiscal 2011○

Disclosing
environmental
information

Environmental
education andawareness○

E-Factory
Activity
Prevent global
warming

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

E-Office
Activity

Fiscal 2013 Target

Green purchasing• Maintain a green purchasing rateof 90.5% or higher for officesupplies and equipment

Fiscal 2013 Achievement• Green purchasing rate: Achieved rate of
90.5% or higher (Monetary basis)*Including newly added items

Progress○

68CSR Report 2013│Environmental Action Plan and Results

Fiscal 2014 (Year ending March 31, 2014) Environmental Action Plan
In fiscal 2014, we are aiming to take our 7E activities to the next level, develop environmental management
systems and improve our environmental performance, on both a divisional and groupwide basis.
Activity
Environmental
management
systemBasic Action Plan
• Establish a groupwide environmental
management system and improve
environmental performance throughcoordinated activities

Fiscal 2014 Target• Obtain ISO 14001 certification at one sales
officeE-Products
Activity

Basic Action Plan

Fiscal 2014 Target

Prevent global
warming• Develop high-efficiency appliances designed tosave energy during usage, reduce standby
power consumption, and continue to develop
leading energy-saving products• Develop high-efficiency appliances- Eco-Jozu bathtub filling units- Eco-Jozu hot-water units (commercial)• Reduce standby power- Fan-forced heaters

Prevent air
pollution• Develop low NOx products for the domestic
and overseas markets• Develop low NOx Eco-Jozu hot-water units

Saving andrecycling
resources• Save resources by developing products andcomponents that are smaller and lighter, andcontinue to develop resource-saving products• Carry out product assessments(on all new products)• Develop lightweight Eco-Jozu products- Eco-Jozu bathtub filling units• Develop water-saving products- Dishwashers

E-Procurement
ActivityGreenprocurement

Basic Action Plan

Fiscal 2014 Target• Work with suppliers and group companies topromote procurement of environmentallyfriendly materials and parts (saving resources,saving energy, recycling, etc.)• Develop green products- Encourage use of materials inaccordance with E-Procurement
Standards• Green procurement management- Maintain and reinforce management of
hazardous chemicals

E-Marketing, E-Service
Activity
Increasing salesof highefficiency
products
Providinginformation on
environmentallyconscious
products

Basic Action Plan

Fiscal 2014 Target• Increase sales of high-efficiency products• Reduce CO2 emissions from hot-water
units used by customers• Hot-water units (hybrid hot-water/heating
system, Eco-Jozu, etc.)• Reduce by 52,000 tons/year• Provide information on environmentallyconscious products through exhibitions,catalogs, fliers, pamphlets, etc.

• Showcase products and raise awareness at
exhibitions in Japan and overseas• Produce and distribute catalogs, flyers andpamphlets

69

CSR Report 2013│Environmental Action Plan and Results

E-Mind, Other
Activity

Basic Action Plan

Fiscal 2014 Target

Disclosing
environmental
information• Disclose information on environmental
activities and products via CSR Report,
website, etc.

• Publish CSR Report 2013
• Disclose environmental information on
website.

Environmental
education andawareness• Actively engage in environmental education
and awareness activities aimed at employees,
and continue to improve environmental
awareness• Promote educational activities in line withcompanywide and site-specific plans forfiscal 2014

Activity

Basic Action Plan

Fiscal 2014 Target

Prevent global
warming• Reduce CO2 emission factor*1: 5% or morecompared to fiscal 2010 level by fiscal 2015

• CO2 emission factor: Reduce by 4% ormore compared to fiscal 2010

• Maintain zero emissions: (Resource recycling
rate of 99.5% or higher)• Maintain and improve zero emissions
record•Reduce waste emission factor*2: 4% or morecompared to fiscal 2011 levels by fiscal 2015

• Waste emission factor: Reduce by 3% ormore compared to fiscal 2011

• Reduce hazardous chemical usage factor*3:
4% or more compared to fiscal 2011 levels by
fiscal 2015

• Hazardous chemical usage factor:
Reduce by 3% or more compared to fiscal
2011• Reduce water consumption factor*4:
4% or more compared to fiscal 2011 levels by
fiscal 2015

•Water consumption factor:
Reduce by 3% or more compared to fiscal
2011

E-Factory

Reduce waste

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

E-Office
ActivityGreenpurchasing

Basic Action Plan
• Achieve a green purchasing rate of 91% orhigher for office supplies and equipment by
fiscal 2015
*Including newly added items

Fiscal 2014 Target• Achieve a green purchasing rate of 91% orhigher, including newly added items(Monetary basis)70

CSR Report 2013│Environmental Accounting

Environmental Accounting
To realize continuous growth while promoting environmental management, we must accurately quantify thecost of environmental protection and the results achieved. We must also ensure that our approaches are
effective through appropriate allocation of management resources. We utilize guidelines set by Japan’s
Ministry of the Environment as the tools in executing these tasks.
Scope of accounting: Rinnai Corporation
Period of accounting: April 1, 2012 to March 31, 2013

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

Key Activities

Costs

Pollution
prevention

Mainly efforts to prevent air and water pollution

2,647

Environmental
protection

Mainly efforts to save energy

4,858

Resource
recycling

Recycling as well as treatment and disposal of industrial waste

2,992

Upstream/downstream

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

2,344Management activities

Mainly monitoring and surveillance of environmental impact

9,553

Research and development

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

153,158

Community efforts

Mainly community activities and beautification/greening at
places of business and surrounding areas237

In the scope ofoperations

Total

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

Environmental
impact reduction
through use of
products

175,789

Content(Unit: Ten thousand yen)
Environmental Impact
Reduction

Saving energy
reduced greenhousegases

320 t CO2/year

Reduction of NOx
with products with
low NOx emissions

129 t/year

High-efficiency
products reduced CO2

70,806 t CO2/year71

CSR Report 2013│Environmental Accounting(Unit: Ten thousand yen)
Economic Effects
Accompanying
Environmental Protection
Measures

Item
Costs cut through energy-savings and waste reduction

Economic Effect
1,517

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

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

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

72

CSR Report 2013│Developing Environmentally Conscious Products

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

Increasing Usage of ECO ONE Hybrid Hot-Water/Heating Systems

It has already been seven years since we began developing the ECO ONE hybrid hot-water/heating system,
combining “Eco Jozu” high-efficiency gas hot-water units with heat pump technology, which uses air as a heatsource. With the 2012 model, we have increased primary energy efficiency from 112%, for the initial model, to aworld-leading 125%*1. For further household energy savings, we are also working on other variations to cater todetached homes, communal living, commercial use and various other installation requirements.
*1 Having calculated primary energy consumption, using a dedicated program for determining homes’ energy saving performance(devised by the Building Research Institute, in conjunction with the National Institute for Land and Infrastructure Management),
the results indicated that ECO ONE has the highest hot-water primary energy efficiency of all electric, gas and oil-powered hotwater units available in Japan.

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

73

CSR Report 2013│Developing Environmentally Conscious Products

Comment from Developer
Enabling people to comfortably save energy
in line with their own lifestyle
When developing ECO ONE, we were determined to improve units’ energy
saving performance whilst at the same time ensuring comfort and usability
across a wide range of scenarios. We incorporated innovations that would
enable users to effortlessly save energy, including an automatic mode that
optimizes hot water depending on usage and an ECO notification feature toraise levels of eco awareness. We are committed to making our products
even more environmentally friendly in the future by increasing primaryenergy efficiency even further and simplifying structures in order to reducematerials.

Hideaki Ogawa
Manager, Engineering Development Division,
Research & Development Headquarters

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

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

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

Resource Recycling Manufacturing Council Chairman’s AwardAt the IMS 2012 Resource Recycling Manufacturing Symposium*2, organized by the Nagoya Industries
Promotion Corporation amongst others, we were presented with the Resource Recycling Manufacturing Council
Chairman’s Award for developing our hybrid hot-water/heating system ECO ONE. Having previously beenrecognized for environmental improvements to our hollow baking furnaces, this is the second time that we have
won this award.
(*2) IMS 2012 Resource Recycling Manufacturing Symposium: Event intended to showcase research aimed at recycling resources,
reducing environmental impact and minimizing global warming from the standpoint of manufacturing, and recognizes outstandingachievements, focusing particularly on companies in the Chubu region

Rinnai presentation at symposium (left) and Junichi Ogawa, Manager
Engineering Development Division, Research & Development Headquarters

74

CSR Report 2013│Developing Environmentally Conscious Products

Energy and Resource Saving Initiatives
KitchenGas Stoves for the ASEAN Market
Saving Energy- Fitted with large burners suitable for wok cooking
Increases thermal efficiency from 42% to 46.5% (LPG model)
Saving Resources- Eco design with lighter components
Stove burners approximately 1 kg lighter (74% reduction
compared to standard Rinnai product)- Components made from at least 90% recyclable materials
Made in Japan- Increased component durability due to specifications that prevent (*1) ASEAN: Association of Southeast Asian
spillages from getting inside the stove (shield structure)
Nations. A high percentage of people in the
Safety/Convenience- Features a sliding adjustment mechanism, making it easier toadjust flames (and preventing unintentional ignition)- Battery ignition to enable usage during power failures

ASEAN region and other Asian countries cook
Chinese-style dishes over a high heat, meaningthat they require stoves with high-powered
burners.

Rinnai Korea Built-in Gas Stove
Saving energy-Thermal efficiency 46% => 52%*LPG model
Saving resources-Stove burners: Weight reduced by approx. 250g
(14% reduction compared to standard Rinnai product)-Increased component durability thanks to Shield structure
Made in Korea
Safety/convenience- “Heat-blocking structure” prevents top plate from becoming too hot

Metal Top Series Built-in Gas Stove/ Tabletop Stove
Saving resources Eco-friendly design with fewer components
 Increased component durability thanks to Shieldstructure
Comfort/convenience Integrated top plate and burner rings to reduce burnt-on
by spillages and make cleaning easier
Made in Japan75

CSR Report 2013│Developing Environmentally Conscious Products

Hot Water
Heat Source for Gas Hot-Water/Heating Systems (RUFH- EM2402 Series)
Saving energy- Uses exhaust heat to achieve thermal efficiency
of approximately 95% (hot water)/
89% (heating)- Reduced power consumption of 2.4W or lesson standby
Saving resources
Approximately 2 kg lighter (4.2% reduction
compared to standard Rinnai product)

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

Made in JapanRUFH0EM2402AFF2-1

RUX-E1610G Series Dedicated Gas Hot-Water Units
Saving energy- Thermal efficiency: 90% (hot-water)- Standby power: Reduced to 1.1W or less
- Compatible with “power-saving display” modeof remote controls, to reduce power consumption
by lowering brightness on the display screen

Features
Dedicated hot-water unit

Made in JapanRUX-E1610G

We have been developing a range of Eco Jozu high-efficiency hot-water units since 2009, to cater to detachedhomes, communal living, commercial use and various other installation requirements. We are also working on othervariations.

Remote Control
MBC-220 Series Dedicated Hot-Water Unit Remote Controls
Saving energy- Equipped with “power-saving display” mode, to reduce power consumption by approximately 45%*2, by lowering
the brightness on the screen and buttons
Saving water- Equipped with “Eco signal” mode, to identify the optimum volume of hot water and help save water more
effectively
Visualizing information/eco-friendliness- Enables users to reduce optimum energy consumption while appreciating the unit’s effectiveness- Equipped with “ENE LIVE” mode, to enable users to check water usage and energy consumption in real time, and“ECO GUIDE” mode, to indicate progress towards energy-saving targets(*2) Power consumption for the top screen, based on RUFH-E2402AW2-6 and MBC-220V (60Hz) set to “ON”
A power-measuring unit (RECU-200) is required to display power usage. Sold separately.
76

CSR Report 2013│Developing Environmentally Conscious Products

For bathroom (BC-220VC)
For Kitchen (MC-220VC)“Eco signal” mode

“ENE LIVE” mode for Kitchen
to enable users to check water usage

Air Conditioning
Bathroom Heater/Dryer with “Splash Mist Sauna” Setting*3
Saving Energy
Reduces CO2 emissions by approximately 60 kg/year if used in eco dry mode*3(32% reduction compared to standard Rinnai product)

Made in Japan

Saving Resources- Reduces water consumption by around 9 m3/year on mist setting (50%reduction compared to standard Rinnai product)- Improved, lightweight mist unit
single-room ventilation : weight reduced by approx. 4kg (25% reduction
compared to standard Rinnai product)
2/3-room ventilation: weight reduced by approx. 2kg (15% reduction
compared to standard Rinnai product)
Comfort/convenience- Equipped with mist sauna mode to warm your body to the core
- Reduced strain on the body when bathing, thanks to quick and effective
heating of cold bathrooms (prevents heat shock)- Drying mode capable of quickly drying out bathrooms after bathing, toprevent mold and make cleaning easier- Enables clothes to be dried in the bathroom, without worrying about dust,
pollen or other airborne pollutants (PM2.5, etc.)*3Mist sauna: The unit produces tiny water droplets (water temperature: 40˚C), so small you can’t even see

them, to envelope your whole body. This enables you to build up a sweat even at cold temperatures, and canhave a positive effect on your skin and metabolism. Included with the RBHM Series*4Eco dry mode: The unit dries with gentle cool breeze and then switches to dry mode.
Included with the RBHM-C337 Series and RBH-C336 Series

77CSR Report 2013│Developing Environmentally Conscious Products

Air Conditioning
Fan-Forced Gas Heater
Saving energy-Features “Eco mode” to control combustion in line with a set temperature andprevent the room from becoming too warm (a domestic first for a fan-forced
gas heater)-Standby power: Reduced from 7W to 0.8W
-Thermal efficiency: 82.4% => 82.5% (RHF-309FT)
82.2% => 82.5% (RHF-559FT)

Made in Japan

Safety-Equipped with “flue blockage detection system,” which uses micro pressure sensors to detect if the flue exit iscovered with snow or has become blocked and automatically turns the heater off-Included as a recommended product under the school facility recommended product scheme*5(*5) Registration scheme for recommended products that meet required performance standards for safety, strengthand quality control for use in school facilities, run by the Research Institute of Educational Facilities(registered product: RHF-559FT)

Hot-Water-Based Energy-Saving Floor Heating System
Saving energy-Combined double-hybrid hot-water/heating system reduces CO2 emissions when hot-water-based floor heatingis in use by approximately 30%*6 compared to standard Rinnai products-50% more radiator pipes embedded in heat mats and improved insulation specifications for hot-water pipes(60% reduction in heat loss), effectively reducing uneven heat above the floor
Comfort/convenience-Radiant heat warms your body to the core, with heat filling the entire room not just the surface of the floor-Capable of quickly generating comforting warmth in any type of room, whether western, Japanese or doubleheight(*6) 2012 study conducted by Rinnai
Made in Japan

Gas Floor heating

Three Advantages: radiance, conduction, and convection

Commercial Units
A Series Steam Ovens
Saving resources- Approx. 3% lighter than standard Rinnai product- Components made from at least 95% recyclable materials
Comfort/convenience-Improved convenience thanks to 10.2-inch LCD touch panel display.
Equipped with self-cleaning mode and audio instructions

Made in Korea

78

CSR Report 2013│Developing Environmentally Conscious Products

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

ECO ONE Presented with Large-Sized Equipment
Packaging Award at Japan Packaging Contest 2012
We have been working on a packaging design that can accommodate tanks
measuring approximately two meters high and weighing over 50 kilograms,
made entirely from cardboard. It is just as strong as wood and other materials,
and even enables items to be shipped on their side. It also considerably
reduces labor as part of the packaging process.

Item placed on its side fortransportation

Gas Stove Packaging for Fitted Kitchens
We have reviewed packaging specifications for built-in gas stoves and significantly reduced the amount of
cardboard that we use. Reducing the volume of packaging per unit has also helped to increase efficiency duringtransportation and storage.

79

CSR Report 2013│Developing Environmentally Conscious Products

Styrene Foam Use Trend (Volume)

Recycling
Recycling of Used Products
Recyclable materials such as iron and copper constitute roughly 80% to upward of 90% (by weight) of
materials used for gas appliances. Used gas appliances that do not require installation work are collected andprocessed via local governments’ routes. Those that do require installation work are collected and processed
via companies that perform such work.
The Environmental and Recycling Committee of the Japan Industrial Association of Gas and Kerosene
Appliances, of which Rinnai is a member, regularly conducts a questionnaire for finding how used gas andkerosene appliances are processed. Recycling demonstration tests at recycling plants and confirmations andinformation exchanges concerning processing are also undertaken as necessary. The survey of Rinnai in fiscal
2013 confirmed that used gas and kerosene appliances are processed appropriately and a high recycling rate ismaintained. We also make use of the results of the survey for designing and improving our products.

Plant where recycling demonstration tests are conducted

80

CSR Report 2013│Developing Environmentally Conscious Products

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

Clothes dryer

Rinnai Products Subject to the Home Appliance Recycling Law and Guideline Values
Product

Recycling Rate Statutory Guideline Value

Unit-style air-conditioner

70%

Clothes dryer

65%

Used Products Recycled into New Products at Rinnai
Product

Unit-style airconditioner

Clothes dryer

Number of units brought to designated collection points

4,548 units

1,138 units

Number of units processed for recycling

4,621 units

1,139 units

Weight of units processed for recycling

189.9 tons

39.9 tons

Weight of recycled materials

178.4 tons

37.1 tons

93%

93%

Recycling rate

* Rinnai's bathroom and kitchen televisions are incorporated into the building architecture. Consequently, they falloutside the liquid-crystal television receiver category added to the national recycling law in April 2009.

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

81CSR Report 2013│Environment-Conscious Monozukuri

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

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

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

82

CSR Report 2013│Environment-Conscious Monozukuri

Pursuing Monozukuri Innovation
Promoting environmental improvement activities through teamwork with business partners
Focus on packing materials used for all hot-water units
Improvement Priorities- Review cutting layout for packing materials and optimize material
extraction- Establish integrated line for glue application and cutting equipment- Reduce shipping losses in order to cut energy consumption- Switch to packing materials that are easy to remove and insert(packaging specifications)

Environmental EffectReduction in waste:
Approx. 7 tons/year

In-house meeting to improveavailable percentage of materials

Reduction in CO2 emissions:
Approx. 2 tons/year

Comment from an Employee
Rigorously Monitoring Managementon the Shop Floor
Scraps, process losses and other types of waste produced during themonozukuri process have a negative effect on both the environment andproductivity. We therefore checked waste deposit sites andcomprehensively reviewed management standards on the shop floor.

Getting all Employees Involved in Environmental
Improvements
Focusing on the manufacturing process for packing materials used for all
hot-water units, we worked with business partners, designers and numerous
other concerned parties to reduce high levels of material loss during
processes.
The key to making improvements was face-to-facecommunication. As well as improving individual processes, we looked atareas between processes, enabling us to improve efficiency at the logistics
stages as well as during the production process. We also reviewed ourexisting packaging methods and focused on making tasks easier during
subsequent processes, for instance by switching to packing materials thatare easy to remove and insert.
It feels really rewarding to see our ideas being put into practice. We
will continue to save energy and resources, as one of our top priorities forthe future, and are committed to resolving issues through monozukuri.

Satoshi Tsuge
Manager, Pre-Production
Department, Seto Factory[Example 1]83

CSR Report 2013│Environment-Conscious Monozukuri[Example 2][Example 3]

Efforts to Prevent Global Warming
Compliance with Energy-Saving Legislation
Rinnai is designated as a “specified business operator” under the revised Act on the Rational Use of Energy,
which came into effect in April 2010. We have therefore established an energy management system headed by the
executive officer in charge of environmental matters as our energy management control officer, and have set out
energy management policies and targets in an effort to improve energy efficiency.

Promoting Energy-Saving Measures at Domestic Facilities
In addition to existing energy-saving activities, we have been working to comprehensively reduce waste since theGreat East Japan Earthquake, in an effort to reduce power consumption as part of a power-saving campaign during
the summer months.

Effects of summer power-saving activities at domestic facilities (June–Sept.)
Power saved

1,290,000 kWh

Power-saving items

390*Power saved equivalent to 15.8% of power consumption compared with the same period in 201084

CSR Report 2013│Environment-Conscious MonozukuriPower/Energy Saving Measures

Upgrades/new
installations(investments)

Installing a solar power generation system, upgrading to high-efficiency lighting and air
conditioning systems, upgrading to high-efficiency vending machines, etc.

Optimization(administration)

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

Optimization(manufacturing)

Optimizing set pressure and start & stop time on compressors, shortening of the operation
time through improvement of the furnace use efficiency, reusing exhaust heat fromboilers, etc.

OthersIntroducing early-morning overtime scheme and reducing late-night overtime (no need for
air conditioning in early morning), issuing peak alerts via power monitoring system,
bringing forward and extending “Cool Biz” operations, eliminating air leaks, organizing“waste patrols” led by female employees, using green curtains and bamboo screens to
reduce strain on air conditioning, etc.

Installing a solar power generation
system (Tohoku Branch)
Power generated: 6,902 kWh
Reduction in CO2 emissions:
Approx. 3 tons (Sept-Mar)

Replacing fluorescent lighting and emergency lights in corridors with LED or
HF fluorescent lights (Oguchi Factory, Head Office, etc.)

Listening to a lecture on
Issuing peak alerts when power
Raising awareness of Clearly labelling switches
energy-saving measures in consumption reaches an upper
energy saving measures
for fluorescent lights
an all employee meeting limit (Production and Technology (Rinnai Parts Center)(Rinnai Precision)(Rinnai Technica)
Development Center)

85

CSR Report 2013│Environment-Conscious Monozukuri

Energy-Saving Measures at Overseas Facilities
Reducing environmental impact by switching energy from steam to natural gas(Shanghai Rinnai Co., Ltd.)We have changed the agent used in pre-coating treatment and reviewed the heat source that we use to enable lowtemperature processing. Whereas we previously used “purchased steam” for heating purposes, it is not possible topurchase steam in specific volumes as and when needed. This resulted in wasted steam due to the periodic
operation of pressure relief valves on days off or overnight when facilities weren’t in use. Now that we haveswitched heat sources to a Rinnai high-efficiency gas hot-water system and a solar water-heating system, we haveeliminated heat loss and substantially reduced environmental impact across the board.
Reduction in CO2 emissions

Approx. 240 tons/year

Reduction in water consumption

1,000 tons/year

Steam pipes running between facilities

High-efficiency gas hot-water system(combined)

Solar water-heating system

Initiatives at Rinnai Korea
We have reduced reactive power by installing harmonic control andpower factor correction filters on terminals at each of our factories.
Reduction in CO2 emissions

Approx. 830 tons/yearMore and more people are coming to visit Rinnai Korea from Japan andother countries, as well as from companies and educational institutions.
We use factory tours as an opportunity to tell people about our ongoingenergy-saving activities, our commitment to quality and environmentallyfriendly manufacturing, and how the kitchen appliances and hot-water
units we manufacture onsite work and benefit the environment.
Visitors participating in factory tours in FY2013

Visitors in a factory tour

1,122

86

CSR Report 2013│Environment-Conscious Monozukuri

Improving Logistics
Working with Logistics Partners
Responding to new requirements associated with the amended energy conservation law, which went into
force in April 2006, Rinnai has promoted improvements based on a rationalization plan for energy used inlogistics activities that was formulated from the perspective of an owner of goods. We properly monitor the
status of energy used in procurement and product shipment activities, and work with our logistics partners to
reduce the amount of energy consumed reviewing our operations from various viewpoints and ideas such as
the loading efficiency.

Major Activities
・Review of product delivery routes
・Effective use of round-trip transportation services
・Expansion of consolidated transport between groups
・Increasing the number of stacks per palette

Examples of Logistics Improvement
Reducing energy consumption by changing transport routes
Having extensively reviewed our delivery systems, we have reduced
intermediate storage and introduced a system that enables us to transport
items directly from our Logistic Center to their destination.

Reduction in CO2 emissions

Approx. 30 tons/year

Rinnai Logistic Center

87

CSR Report 2013│Environment-Conscious Monozukuri

Establishing a Same-Day (through) Shipping System
We have introduced a same-day shipping (throughshipping) system*1, whereby selected products deliveredfrom factories are sorted and dispatched to the customer
the same day. We have changed the system so that
products for same-day shipping go straight from sortingto their shipping route, rather than being stored on
shelves as is usually the case. This has enabled us tosignificantly reduce usage of transport machines to carry
incoming or outgoing products.
(*1) Same-day shipping (through shipping): System ofshipping without keeping stock
Reduction in
CO2 emissions

Approx. 20 tons/year

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

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

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

Initiatives at Domestic Facilities
Reducing Glaze Sludge (Oguchi Factory)
Rather than disposing of the glazing agents used in our hollow baking processes, we have made a speciallydesigned scraper to collect glaze inside the glazing machine, so that it can be recovered and reused. Improvements
such as this have enabled us to reduce volumes of glaze sludge.
Reduction in waste

Approx. 2 tons/year

88

CSR Report 2013│Environment-Conscious Monozukuri

Reducing cardboard usage (RB Controls)
By switching packaging from cardboard to returnable containers when receiving electronic unit cases for hot-water
units from suppliers, we have eliminated the need for large cardboard cartons that become waste after usage.
Reduction in waste

Approx. 2 tons/year

Industrial Waste Disposal
We rigorously screen waste disposal contractors before signing
contracts, including checking business conditions and making
onsite visits. To ensure that waste is being disposed of properly, wesend representatives to visit contractors every year, to carry out
visual confirmation and exchange information on matters such as
types of waste, waste manifest management for disposal methods
and conditions, and standards of waste disposal. In fiscal 2013, we
confirmed that 65 contractors were conducting waste management
in an appropriate manner.

Visiting disposal sites(RT Engineering)

Polychlorinated Biphenyl Waste Management
Polychlorinated biphenyls (PCB) are used for purposes such as
insulating oils and are subject to the Act on Special Measuresconcerning Promotion of Proper Treatment of PBC Wastes, which
requires companies to reinforce storage and safely dispose of PCB by
the end of March 2027. Although we are continuing with measures
aimed at disposing of PCB as soon as possible, in the meantime, we aretaking steps to prevent leaks in the event of equipment failure duringstorage, keeping PCB under lock-and-key to prevent loss or damage,and monitoring equipment using nameplates, until disposal of PCB canbe completed.
We are also taking measures to ensure that scrap appliances found to
Storing waste with trace elements
contain trace elements of PCB are adequately stored and appropriatelyof PCB (Noto Tech)disposed of at facilities certified by the Minister for the Environment
from fiscal 2011 onwards.
*Disposal of waste containing high levels of PCB, stored at Rinnai and RT Engineering, was completed
in March 200989

CSR Report 2013│Environment-Conscious Monozukuri

Initiatives at Overseas Facilities
Rinnai New Zealand
We are working to reduce waste on the manufacturing shop floor, following the example of recycling and otheractivities at domestic facilities in Japan.

Thorough separation of waste for recycling

Recycling of waste wood

Rinnai Brasil Heating Technology
We use PET resin recycled from used plastic bottles as an insulating material in the solar panels that wemanufacture onsite, in an effort to effectively reuse resources.

Plastic bottles

Reusing PET resin

90

CSR Report 2013│Environment-Conscious Monozukuri

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

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

Example of reduction in Chemicals
Paint-free initiatives
We use colored resin (metallic finish) for external parts on our gas stoves, including flame adjustment knobs andignition buttons, so that they don’t need to be painted.
Reduction of paint use

approx. 18 tons/year -> Zero

Reduction in thinner use

approx. 15 tons/year -> Zero91

CSR Report 2013│Environment-Conscious Monozukuri

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

Emergency response drill

Environment-Focused Equipment Inspection
To prevent accidents that would impact the environment, we
identify equipment with the potential to adversely affect theenvironment and run concerted environment-focused inspections
on these pieces of equipment on an annual basis.

Equipment inspection

92

CSR Report 2013│Environment-Conscious Monozukuri

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

Reusing Test Water (Technology Development Center)
We use a lot of water for various performance tests on our hot-water units during the development stages.
Switching to a mechanism that enables us to recycle test water can make a big difference in terms of saving water,
providing that it doesn’t affect the test results. We have therefore carried out improvements to water circuits usedin wind-resistance test equipment*1, particularly for outdoor hot-water units, in order to establish a mechanismthat will enable us to recycle water.
Reduction in water consumption

Approx. 1,000m3/year* We conduct wind-resistance tests to assess the safety of products installed in outdoor locations exposed to windand rain, to ensure that wind cannot penetrate inside the unit.

Wind-resistance testing equipment (exterior)Heat source for gas hot-water unit/heating system

Initiatives at Overseas Facilities
Effectively reusing rainwater (Rinnai Australia)
We effectively reuse rainwater for purposes such as watering plants
and flowers, and flushing toilets.

Rainwater tank

Water-saving efforts (Rinnai Indonesia)
We have installed water-saving faucets at wash stations. We haveswitched to water-saving push faucets, to make it easier to turn taps
on and off.
BeforeAfter

Wash station

93

CSR Report 2013│Environment-Conscious Monozukuri

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

94

CSR Report 2013│Environment-Conscious Monozukuri

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

Measurement of soot and smoke (left), and water quality

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

Status of Compliance with Laws and Regulations
In fiscal 2013, ended March 31, 2013, there were no violations of environment-related laws such as pollution
control laws.
Major related laws
Air pollution

Air Pollution Control Act

Water pollution

Water Pollution Control Act, Sewerage Act

Land subsidence

Industrial Water Act

Noise and bad odors

Noise Regulation Act, Vibration Regulation Act, Offensive Odor Control Act

Hazardous
substances

Poisonous and Deleterious Substances Control Act

Employee safety

Industrial Safety and Health Act (Ordinance on Prevention of Hazards due to Specified
Chemical Substances, Ordinance on Prevention of Organic Solvent Poisoning)Fire Service Act (Articles concerning hazardous materials)

Prevention of global
warming

Law Concerning the Promotion of the Measures to Cope with Global Warming

Waste

Waste Management and Public Cleansing Act

Ecosystem

Act on Confirmation, etc. of Release Amounts of Specific Chemical Substances in theEnvironment and Promotion of Improvements to the Management Thereof, Act on Special
Measures concerning Promotion of Proper Treatment of PCB Wastes

Act on the Rational Use of Energy95

CSR Report 2013│Environmental Education and Promotion of Awareness

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

Rinnai Group Environment Awards Programs
Seeking to invigorate employees’ environmental activities and promote access to excellent approaches within theGroup, we established “Environment Awards Programs”, effective from fiscal 2011. These awards programs
recognize activities undertaken by domestic companies under the Rinnai umbrella to protect the environment andconserve resources over a one year period. The third award ceremony took place as part of our “Company-wide QC
Circle Competition.” For fiscal 2013, awards were presented in recognition of outstanding achievements in four
categories; product development, manufacturing, management and outside contribution.

Award ceremony, and panel display showing outstanding achievements

Recipients of Environment Awards in fiscal 2013
Product development

Development of hybrid hot-water/heating system

Manufacturing

Introduction of side plate servo press on hot-water units

Management

Establishment of a solar power generation system in the event of a power failure

Outside contribution

Appearance on an energy-saving awareness show

Other awards

8

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

Showroom (left) and Q&A session

96CSR Report 2013│Environmental Education and Promotion of Awareness

Walking Festival
In May, an event for learning about biodiversity protection with families was planned and held as part of the
Walking Festival (at a 10,000-step course in Higashiyama and the Higashiyama Zoo and Botanical Gardens)organized by the Rinnai Employees’ Association.
Number of participants

1,460

Employees walking through the green woodlands with their families

Encouragement of Eco-Friendly Commuting
At our Technology Development Center, we designate “No Car Days” andencourage employees to commute in an eco-friendly manner, in an effort to reduce
CO2 emissions and noise from commuting by car, and to minimize the effects oftraffic jams. As well as reducing environmental impact, steps such as commuting
by public transport or bicycle instead of by car also help to keep employees
healthy by providing moderate exercise.

CO2 emission reduction result

approx. 1 t-CO2/year

Bicycle parking area for
employees

Environment Policy Card
We distribute an “Environment Card” that lists selected Environmental Policy toemployees to promote their awareness toward environment conservation
activities. Employees fill in “My Environment Challenge Declaration” on thereverse side of their card, to raise levels of environmental awareness in theworkplace and at home too.

Environment Card

97

CSR Report 2013│Environmental Education and Promotion of AwarenessIssuance of Environment Company NewsWe periodically issue “Environment Company News” to shareinternal environmental measures and introduce domestic andinternational trends on environment activities. This is to promote
the communication among employees and encourage them to be
more environment-conscious.
Rinnai Group“Environment Company News”“Safe and Eco-Friendly Drive Seminar”
For the prevention of car accidents and global warming,
we invited a guest instructor and held a “Safe and EcoFriendly Drive Seminar” for employees in sales andmanagement divisions who use a company car. It is on
the guidance and explanation on “the basics of traffic
safety” and “actual training of eco-friendly training”
and 41 employees attended the seminar.
Attendees

41/year

Safe and Eco-Friendly Drive Seminar (left) and“idling stop” display at Branch office

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

Visiting Local Dealers with a Vehicle Dedicated for Holding Training Sessions(Rinnai Brasil Heating Technology Ltd.)In Brazil, demand for durable, weatherproof, high-efficiency
hot water units has been growing each year. Rinnai Brasil,
which locally manufactures and sells high-efficiency hotwater units, solar hot water panels, and other products, visitsdealers in each area using a vehicle equipped with actual
devices and enabling training sessions. The sessions are
aimed at allowing dealers in each area to perform sales
activities and installation work with proper understanding of
installation, construction, and maintenance methods. Manuals
are used for providing dealers with explanations about
products. Dealers also learn how to operate and handle hotwater units by using the actual unit mounted on the vehicle.

Vehicle dedicated for training

Hot water unit

98

CSR Report 2013│Environmental Education and Promotion of AwarenessOverseas Exhibitions
Large Booth at the International Food Industry Exhibition, Seoul
Rinnai Korea Corporation
We exhibited a range of commercial products manufactured and sold in Korea,
including steam ovens, dishwashers and rice cookers, in an effort to showcase
their performance in terms of environmental friendliness, convenience andsafety.

International Food Industry
Exhibition

Exhibiting at Malaysia’s Largest Home Decor and Design Exhibition (HOMEDEC)
Rinnai Rinnai (Malaysia)
We showed visitors how well our kitchen appliances and other products perform, in terms of environmental
friendliness, convenience and safety. During the exhibition, our kitchen appliances won a “Good Design Award”.

Rinnai booth at HOMEDEC (left) and employees from Rinnai (Malaysia)

Air-Conditioning, Heating, and Refrigeration Institute (AHRI) in Chicago
Rinnai America
We exhibited at the Air-Conditioning, Heating, and Refrigeration Institute(AHRI), the largest trade fair for hot-water units in the US, and showed visitors
how well our products perform, in terms of environmental friendliness,convenience and safety.

Rinnai booth at AHRI

99

CSR Report 2013┃Chronology of Environmental Activities at Rinnai

Chronology of Environmental Activities at Rinnai
March

1993

December

1994

July

1996

March
March
June

1997

October
December
April

1998

September
October
April

1999

July
September
October
February

2000

May
August2001

January
June
June

2003
2004
2005

October
October
June
September

2006

October
September

2008

2009

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

October

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

February

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

100

CSR Report 2013┃Chronology of Environmental Activities at Rinnai

January2010

February
April
DecemberJanuary
April

2011

May
June
April
June

2012
September
October

2013

June

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

101

CSR Report 2013┃Major Award Winning History

Major Award Winning History
Rinnai received following awards from April 1, 2012 to June 30, 2013.

Rinnai Corporation
June
2012

OctoberNovember
December

2013

June

Technology Award 2012 from Japan Gas Association
Aichi Invention Encouragement Award 2012 from Aichi Invention Association
Large and Heavy Good Packaging Prize of Japan Packaging Contest 2012
Good Design Award 2012
Grand Quality Prize of Gas Appliance Quality Contest 2012
Chairman Award of the 17th Resource Circulation Monozukuri SymposiumTechnology Award of The Japan Gas Association 2013
Aichi Invention Award 2013 from Aichi Invention Association

Rinnai Technica Co., Ltd.
2012

June

Governor award at the conference for employment promotion of people with disabilities
in Shizuoka Prefecture

RB Controls Co., Ltd.
2013

March

Employee-friendly workplace award in Kanazawa-shi, Ishikawa PrefectureAward as a superior enterprise in work-life balance from Governor of Ishikawa Prefecture

Rinnai Korea Corporation
April
September
2012

OctoberNovember
DecemberFebruary

2013

March
April
June

2012

October

Korea Management Association Consultants Inc. (KMAC):
Superior call center in Korea
Korean Industry Customer Satisfaction Index Survey (KCSI) by KMAC
No. 1 at home-use boiler section
Brand Survey by Korean Standard Association: Korea Service Quality Index
No.1 at home-use boiler A/S section
Brand Survey by Korean Standard Association:
Superior enterprise with quality competitiveness
Brand Survey by KMAC: Company which a customer recommends mostNo. 1 at home-use boiler section
Pinup Design Award from Korean Industrial Designer Association
Brand Survey by KMAC: Korea’s most admired company
No.1 at home-use boiler A/S section
Brand Survey by KMAC: Korea Brand Power Index
No.1 at gas range section
Brand Survey by KMAC: Superior call center in Korea
Brand Survey by Korean Standard Association: Korea Service Quality Index
No.1 at home-use boiler A/S section
Rinnai New Zealand Ltd.
Bronze prize at product section, Good Design Award
102

CSR Report 2013┃CSR report

CSR Report
Rinnai puts out a CSR Report to convey to stakeholders management’s approach
to CSR, to describe the activities undertaken groupwide, and to encourage a
deeper understanding of the Group’s operations.
CSR Report 2013 puts a spotlight on CSR activities carried out through theexecution of core operations and aims to promote greater awareness of the Group’s
perspective on CSR to as many people as possible.

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

Reporting Period
This report focuses on events that occurred in fiscal 2013—April 1, 2012, to March 31, 2013—but also touches
upon measures implemented and recent activities undertaken prior to fiscal 2013 as well as future businessdirection, targets and plans.

Referenced Guidelines
Sustainability Reporting Guidelines (G3.1), the third and most recent
generation of guidelines by the Global Reporting Initiative (GRI)
ISO 26000:2010
Environmental Reporting Guidelines (fiscal 2007), issued by Japan’s Ministry of the Environment
Environmental Accounting Guidelines (fiscal 2005), issued by Japan’s Ministry of the Environment

Publication Schedule
October 2013 (Japanese version), previous: September 2012, next:
August 2014 (planned)

103

CSR Report 2013┃CSR report

Rinnai’s Activities
To provide an overview of our CSR activities in an easy-to-understand way, we produce an abridged version of our
CSR Report in booklet form. Information not contained in the booklet—such as case studies, specific details, andrelated data—is posted on the website.

104

RINNAI GROUP

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

SOUTH KOREA●Rinnai Korea Corporation●RB Korea Ltd.

Rinnai Services (MS)Corporation●●Rinnai UK Ltd.

●RS Korea Ltd.

CHINA●RK Precision Co., Ltd.

●Shanghai Rinnai Co., Ltd.

●Rinnai Plus Corp.

●Shanghai RB Controls Co., Ltd.

●Rinnai SE Corp.

●Mikuni RK Corporation●Guangzhou Ming Hai Gas and Electrical Appliance Co., Ltd.
●

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

Rinnai Italia s.r.l.

●Hainan Rinnai Minsheng Kitchen Appliances Sales Co., Ltd.
●Guangzhou Rishangsheng Gas and Electric Appliances Sales Co.
●Shanghai Rinnai Thermo Energy Engineering Co., Ltd.

Rinnai Hong Kong Ltd.●●Rinnai Taiwan Corporation

Rinnai (Thailand) Co., Ltd.●●Rinnai Vietnam Co., Ltd.
●Rinnai (Malaysia) Sdn. Bhd.

Corporate Data

(As of March 31, 2013)●Rinnai Holdings (Pacific) Pte Ltd.
●P.T. Rinnai Indonesia

Incorporated: September 1, 1920
Established: September 2, 1950
Paid-in capital: ¥6,459,746,974
Head office: 2-26, Fukuzumi-cho,
Nakagawa-ku, Nagoya 454-0802, Japan

Rinnai Australia Pty., Ltd.

Number of employees: 8,824 (consolidated),
3,628 (non-consolidated)●

Number of Group companies: 44 (domestic 14, overseas 30)

Hot-Water Units and Heating Systems

Kitchen Appliances

With superior energy efficiency, Rinnai’s
hot-water units and heating systems meetthe needs of people for more sophisticated,comfortable living, offering such functions as
floor heating and bathroom heating.

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

Hot-water units, hot-water/heating units, Hybrid
hot-water and heating system, bathroom heater/dryer,
mist sauna, floor heating systems, and others

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

105

JAPAN●Rinnai Corporation●Yanagisawa Manufacturing Co., Ltd.

Branches: Tohoku, Kanto, Chubu,
Kansai, Kyushu
Domestic sales offices: Hokkaido,
Sendai, Niigata, Tokyo, Kita-Kanto,
Higashi-Kanto, Minami-Kanto,
Nagoya, Shizuoka, Hokuriku, Nagano,
Osaka, Keji, Hyogo, Chugoku,
Shikoku, Fukuoka
Laboratory: Technology Development
Center
Factories and related centers: Oguchi
Factory, Seto Factory, Asahi Factory,
Akatsuki Factory, Production andTechnology Development Center,
Integrated Logistics Center, Parts Center●Rinnai Technica Co., Ltd.
●RB Controls Co., Ltd.
●Rinnai Precision Co., Ltd.
●RT Engineering Co., Ltd.
●Japan Ceramics Co., Ltd.
●Noto Tech Co., Ltd.
●Techno Parts Co., Ltd.
●Glanstrahl Co., Ltd.
●Rinnai Net Co., Ltd.
●RG Co., Ltd.

●Rinnai Canada Holdings Ltd.

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

Rinnai America Corporation

Net Sales by Product (Year ended March 31, 2013)(Billions of yen)

Others¥23.3 billion (+0.3%)
Hot-water units¥127.1 billion (+5.0%)

Commercial-use equipment¥6.9 billion (+1.0%)
Air-conditioning andheating units¥15.6 billion (–6.1%)

Net Sales by Region (Year ended March 31, 2013)(Billions of yen)China
¥12.8 billion (+10.4%)
Australia¥13.7 billion (–8.4%)

Others¥12.2 billion (+5.1%)
Japan¥180.5 billion (+3.1%)

United States¥11.3 billion (–2.2%)
Korea¥21.2 billion (–2.3%)

Total¥251.8 billion(+2.1%)

Total¥251.8 billion(+2.1%)

Kitchen appliances¥78.7 billion (–0.0%)
Parentheses indicate
percentage changeover previous
corresponding period.

Rinnai Brasil ●Heating Technology Ltd.

Parentheses indicate
percentage changeover previous
corresponding period.

●Rinnai New Zealand Ltd.
●HJ Cooper Limited

Air-Conditioning and Heating Units

Commercial-Use Equipment

Seeking to create comfortable living spaces offering
total relaxation and peace ofmind, Rinnai develops a widearray of air-conditioning andheating units.
Commercial-use stoves, ranges,
rice cookers, industrial ceramics
machines, steam oven, and others

OthersFan heaters, fanned flue heaters, infrared heaters, gas fires,and others

Clothes dryers, infrared burners andcomponents

106

CSR Report 2013│Supplemental Data 1

Oguchi Factory
Location
Number of employees
Business
Commenced operations:
Acquisition of ISO14001 certification:

Kaechi, Oguchi-cho, Niwa-gun, Aichi
847 (as of March 31, 2013)
Manufacture of gas equipment
1964
October 1997

Major production items

Gas tabletop stoves

Gas built-in stoves

Built-in ranges Dishwashers and others

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

LP gas
(t)

457.2

71.5

6.0

Other fuels(kl)(crude oil equivalent)
30.8

Emissions into the air
CO2 emissions(t-CO2)
3,397

NOx emissions(t)
2.7

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)5,213.2

0.0

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage(%)

5,213.2

100.0

Substances subject to the PRTR law

Class I designated chemical
substance name

Number

53
80
296
300
309
405

a. Emissions
into the air

Ethylbenzene
Xylene1,2,4-trimethylbenzene
TolueneNickel compounds
Boron compounds

1,200.0
1,700.01301,200.0
0.0
0.0

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

d. Landfill
at therelevant
office

0.0
0.0
0.0
0.0
0.0
0.0

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

0.2
190.0
390.0
63.0
140.0
550.0

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

National
0.25
180
0.10
150

Regulation value*1
Prefectural
Voluntary
0.25
0.16
180
150
0.30
0.08
150
96

Actualvalue*2
0.002
66.5
0.011
63.0

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

Oguhi Factory 1

CSR Report 2013│Supplemental Data 1

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

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

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

Maximum
431.0
7.4
120.0
91.0
<1
6.0
0.20
0.20
0.30
0.55
40.0
6.4
29.0

Actual value
Minimum
7.0
6.6
17.0
23.0
<1
3.0
0.02
0.03
0.03
0.01
9.2
1.6
4.5

Mean
151.0
7.2
84.8
60.4
<1
4.5
0.07
0.10
0.17
0.07
27.2
3.7
13.8

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

Environmental Initiatives
Energy saving efforts
Having previously performed two-color and one-color printing via three processes on separate pieces ofequipment, we have managed to streamline production and reduce energy consumption across all equipment byreviewing operations, including the layout of our printing line.
Reduction in CO2 emissions:

Approx. 28 tons/year

Reduction in power consumption:

74,000 kWh/year

Printing line

[Before]Two-color and one-color
printing via three processes[After]Two-color printing via two processes and one-color
printing via a separate line, thereby saving energy

Resource saving efforts
We reuse packing materials used when shipping top panels for stoves.
Reduction in waste:

Approx. 180 kg/year

Panel ready for shipping

Gas stove (after assembly)

Oguhi Factory 2

CSR Report 2013│Supplemental Data 2

Seto Factory
Location
Number of employees
Business
Commenced operations

Anada-cho, Seto-shi, Aichi
809 (as of March 31, 2013)
Manufacture of gas equipment
1979
December 2000

Acquisition of ISO14001 certification

Major production items

Hybrid hot-water/heating
systemGas Hot- waterand heating source

Gas hot-water
units

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

LP gas
(t)

654.4

66.5

31.6

Other fuels(kl)(crude oil equivalent)
17.2

Emissions into the air
CO2 emissions(t-CO2)
4,075

NOx emissions(t)
3.2

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)2,358.9

0.0

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage(%)

2,358.9

100.0

Substances subject to the PRTR law

Class I designated chemical
substance name

Number

53
80
87
300
308

Ethylbenzene
XyleneChromium and chromium (III)compounds
TolueneNickelAmount of emission/discharge
a. Emissions b. Discharge c. Discharge
into the air
into public
into the soil
watersat therelevant
office(except d.)
840.0
0.8
0.0
1,200.0
0.8
0.0

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

0.0
0.0

0.0
0.0

330.0
300.0

0.0

0.0

0.0

0.0

0.0

0.0

720.0
0.0

0.0
0.0

0.0
0.0

0.0
0.0

0.0
0.0

380.0
0.0

Air
Equipment
BoilerSubstance
Soot and dust
NOx

National
0.10
150Regulation value*1
Prefectural
Voluntary
0.30
0.05
150
79

Actualvalue*2<0.02
24.5*1 Units of regulation values
Soot and dust: g/m3N
NOx: ppm*2 Actual values for NOx and soot/dust indicate
the maximum measurements versus theregulation values for the relevant type ofequipment.

Seto Factory 1

CSR Report 2013│Supplemental Data 2

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

Regulation value
National
Prefectural Voluntary

Actual value
Maximum Minimum

Mean

‒

‒

‒

61

23

40

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

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

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

8.0
1.7
5.2
1.2
1.2
< 0.5
0.20
0.33
0.1
N.D.
27.0
2.8

7.3
< 0.5
0.6
<1
< 0.5
< 0.5
0.01
N.D.
N.D.
N.D.
0.2
0.01

7.6
0.9
1.9
0.3
0.1
< 0.5
0.05
0.05
N.D.
N.D.
3.5
0.3

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

Environmental Initiatives
Energy saving efforts
We have developed our own “air leak measurement jigs,” which are capable of measuring air leaks on individual
pieces of equipment, in an effort to eliminate wasted energy. As well as effectively reusing off-cut materials to
make the jigs, this has also enabled us to quantitatively monitor leaks for each piece of equipment andcomponent, so that we can improve our conservation activities.
Reduction in CO2 emissions:

Approx. 18 tons/year

Air leak measurement jig

Leak detected

No leak detected

Communication with local communities
We run apprentice schemes lasting roughly one month, to provide local senior high school students with work
experience and to assist in their social studies. We also organize factory tours for local elementary school
students, and explain how the water heaters in each of their homes actually work.

Learning the basics of manufacturing
and about our commitment to quality and the environment

Explaining how water heaters work

Seto Factory 2

CSR Report 2013│Supplemental Data 3

Asahi Factory
Location
Number of employees
Business
Production started

Nishiyama-cho, Owariasahi-shi, Aichi
270 (as March 31, 2013)
Manufacture of gas equipment
1960
November 2003

Acquisition of ISO14001 certification

Major production items

Gas fan heaters

Gas clothes
dryersBathroom
heaters/dryers

Gas fan-forced
heaters

Infrared heaters
and others

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

LP gas
(t)

144.9

18.0

2.3

Other fuels(kl)(crude oil equivalent)
4.3

Emissions into the air
CO2 emissions(t-CO2)960

NOx emissions(t)
0.8

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

535.0

0.0

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

535.0

100.0

Substances subject to the PRTR law

Class I designated chemical
substance name

Number

53
80
296
300

a. Emissions
into the air

Ethylbenzene
Xylene1,2,4-trimethylbenzene
Toluene760.0
1,430.0
200.0
3,030.0

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

d. Landfill
at therelevant
office

0.0
0.0
0.0
0.0

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

1,260.0
1,330.0280.0
5,260.0

Air
Equipment

Substance

Drying furnaces

Soot and dust
NOx

National
0.2
230Regulation value*1
Prefectural
Voluntary
‒
0.108
‒
200

Actualvalue*2
0.036
39.5*1 Units of regulation values
Soot and dust: g/m3N
NOx: ppm*2 Actual values for NOx and soot/dust indicate
the maximum measurements versus theregulation values for the relevant type ofequipment.

Asahi Factory 1

CSR Report 2013│Supplemental Data 3

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

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

Actual value
Maximum Minimum
50.0
13.0
7.3
6.9
190.0
75.0
105.0
22.0
1.7
< 0.5
15.3
2.5
N.D.
N.D.
0.62
0.15
0.40
0.10
N.D.
N.D.
49.0
29.0
4.6
2.6
130.0
19.0

Mean
30.3
7.1
113.4
46.3
0.32
6.8
N.D.
0.34
0.23
N.D.
38.3
3.4
58.3

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

Environmental Initiatives
Energy saving efforts
As part of building renovation work, we have installed more durable exterior walls
and fitted insulation panels on interior walls. This has enabled us to save energy
from our air conditioning systems, by preventing the walls from becoming too hot
during the summer months. (Photo: exterior walls)
We have installed pull switches (cords) on fluorescent lighting, to enable lights to be partially switched off
depending on day-to-day attendance, and are working to raise awareness of power saving.
BeforeLights partially switched off

After

Desks

Desks

Desks

Desks

Lights off

Lights partially off

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

Explaining how fan heaters work

Students being shown round individual production lines

Asahi Factory 2

CSR Report 2013│Supplemental Data 4

Rinnai Parts Center *1(former Aichi Factory)
Location
Number of employees
Business
Commenced operations
Acquisition of ISO14001 certification

Sumiike-cho, Nakagawa-ku, Nagoya-shi,
Aichi
189 (as of March 31, 2013)
Manufacture of gas equipment
1955
November 2003

Major production items*1 In May 2013, Rinnai transferred kitchen appliance production base to Oguchi

Bathroom
remote controls

Kitchenremote controls

Factory (Niwa-gun, Aichi) from Aichi Factory, and the former Parts Center(Hirokawa-cho, Nakagawa-ku, Nagoya) functions --- storage and shipping for
replacement parts--- was transferred to the Aichi Factory. As part of this move,the former Aichi Factory was renamed the Rinnai Parts Center as of July 1,
2013. This 2013 Site Report therefore contains environmental data of theformer Aichi Factory (actual results of fiscal 2013, ended March 31, 2013).

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

LP gas
(t)

56.5

4.2

1.2

Other fuels(kl)(crude oil equivalent)
2.4

Emissions into the air
CO2 emissions(t-CO2)316

NOx emissions(t)
0.3

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

106.9

0.0

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

106.9

100.0

Environmental Initiatives
Conserving water
We have reduced water consumption by fitting motion sensors over plate
return points in our staff canteen, so that water only comes out to wash
plates when required. We try to conserve water as precisely as possible,
ensuring that no more water comes out of the tap than is strictly
necessary at each washing station (e.g. we use less water for the edges ofplates, which tend to be less dirty).
Reduction in water consumption:

865m3/year

Motion sensors

Rinnai Parts Center 1

CSR Report 2013│Supplemental Data 4

Resource saving efforts
We have changed the way we package individual parts, and make every effort to reduce our defect rate andminimize the volume of waste that we generate.
Switching packaging materials from plastic straps to returnable boxes

Easily damaged[Before] Items bound in plastic straps for delivery[After] Items loaded into returnable
boxes for delivery (photo from front)

Switching packaging specifications for instruction manuals, from paper packaging to returnable bags

[Before] Paper packaging[After] Manuals delivered inreturnable bags

Communication with local communities
We organize regular factory tours for employees’ families, giving them the opportunity to see inside theworkplace and understand the sort of work that we do.
We also organize factory tours for local elementary school students, as part of their social studies, and show
them the process through which gas stoves are actually made. (Number of students: 41/year)

Employees’ families on a factory tour

Elementary school students on afactory tour

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

Cleanup activities along commuting routes

Cleanup activities in the areasurrounding the factory

Rinnai Parts Center 2

CSR Report 2013│Supplemental Data 5

Yanagisawa Manufacturing Co., Ltd.
Location
Number of employees
Business
Commenced operations

Yanagi-machi, Kadoma-shi, Osaka
381 (as March 31, 2013)
Manufacture of gas equipment
1936
June 2004

Acquisition of ISO14001 certification

Major production items

Commercial
high-speed ovens

Commercial
kitchen units

Gas rice cookers

Floor heating systems(hot-water mat)

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

LP gas
(t)

199.5

36.6

1.0

Other fuels(kl)(crude oil equivalent)
11.0

Emissions into the air
CO2 emissions(t-CO2)
1,588

NOx emissions(t)1.3Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

571.8

0.0

Equipment

Substance

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

571.8

100.0

Air

BoilerDrying furnaces

Soot and dust
NOx
Soot and dust

National
0.15
150
0.15

Regulation value*1
Prefectural
Voluntary
0.10
0.10
150
150
0.10
0.1

Actualvalue*20.003
420.0022*1 Units of regulation values
Soot and dust: g/m3N
NOx: ppm*2 Actual values for NOx and soot/dust indicate
the maximum measurements versus theregulation values for the relevant type ofequipment.

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

Regulation value
National
Municipal Voluntary‒‒‒
5.0 - 9.0
5.0 - 9.0
5.9 - 8.5
600
600
300
600
600
300
5
5
5
30
30
24
3
3
3
2
2
2
10
10
3
10
10
10
240
240
120
32
32
30
220
220
110

Actual value
Maximum Minimum
56.0
44.8
8.5
7.0
73.0
10.0
28.0
2.0
1.8
1.0
19.8
1.6
<0.1
<0.1
0.84
0.06
<0.1
<0.1
<0.1
<0.1
20
18
33*
0.1
2.0
<0.1

Mean
50.4
7.5
33.9
9.3
1.3
8.0
<0.1
0.24
<0.1
<0.1
19
7.8
1.5

■ The unit of the amount of discharge is m3/day■ The values are expressed in mg/L except forpH■ Water discharge standard:
Sewer discharge standard* pH: Concentration of hydrogen ions
* BOD: Biochemical oxygen demand* SS: Concentration of aqueous suspended
solids* N.D.: Equal to or less than the minimum
determination limit(undetectable)*Wastewater quality tests indicated that
Phosphorus levels were higher thanself-imposed standards (agreed with Kadoma
City). We therefore identified the source andtook countermeasures. The results ofsubsequent analysis indicated that water quality
was within safe range under the self-imposed
standards.

Yanagisawa Manufacturing Co., Ltd. 1

CSR Report 2013│Supplemental Data 5

Environmental Initiatives
Energy saving efforts
Upgrading to energy-saving air conditioning systems
As part of improvements to the air conditioning systems in our press building, we have replaced our existing
oil-powered heaters with gas heat pump (GHP) air conditioning systems, which reduce energy consumption
during the winter months.
Reduction in CO2 emissions:

Approx. 61 tons/year[Before][After] GHP

Air conditioning outlets

Saving energy via two-tiered roofing
As part of improvements to the roof of our premises, we created a space
above the existing roof and fitted boards with a heat shield coating to
produce a two-tiered structure. This has made insulation more effective andenabled us to reduce energy consumption from air conditioning systems, by
preventing ceilings from becoming too hot during the summer months.

Boards with a heat shied coating
installed on the roof

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

Employee cleanup operations

Cleanup activities along commuting routes

Yanagisawa Manufacturing Co., Ltd. 2

CSR Report 2013│Supplemental Data 6

Rinnai Technica Co., Ltd.
Location
Number of employees
Business
Commenced operations

Sakagawa, Kakegawa-shi, Shizuoka
499 (as of March 31, 2013)
Manufacture of gas equipment
1910
December 2003

Acquisition of ISO14001 certification

Major production items:

Gas hot-waterunits

Gas instant-heating
hot-water heaters

Gas hot-water
units for overseas
marketHeat exchanger
and others

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

265.2

362.0

Other fuels(kl)(crude oil equivalent)
25.1

Emissions into the air
CO2 emissions(t-CO2)2,150

NOx emissions(t)
1.9

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

928.0

0.9

Amount ofintermediate
processing of waste(t)
0.3

Amount of recycled
waste
(t)

Recycling
percentage
(%)

926.8

99.9

Water discharge
Substance
Amount of discharge
pH
BOD
COD
SS

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

Regulation value
Prefectural Voluntary‒‒‒
6.3 - 8.1

Maximum
94
7.8

Actual value
Minimum
15
7.3

Mean
46.2
7.6

25 (20)20 (15)

5.2

0.6

2.4

‒

20 (15)

5.7

2.7

4.2

50 (40)30 (20)

‒

< 2.0

‒

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

Rinnai Technica Co., Ltd. 1

CSR Report 2013│Supplemental Data 6

Environmental Initiatives
Energy saving efforts
As well as upgrading to an energy saving air compressor, we have revised thelayout of our facilities to suit operations on the shop floor and havesuccessfully reduced energy consumption. This has also helped to minimize
noise levels.
Reduction in power consumption:

108,612 kWh/year

Reduction in CO2 emissions:

Approx. 4.5 tons/year
Air compressor

We have carried out improvements to the building’s roof, to let in sufficient light to the factory as a whole. As
well as improving daylight penetration, so that we no longer need to use lighting along corridors in the day, thishas also enhanced insulation and enabled us to reduce overall energy consumption. The multilayer polycarbonate
we have used as a roof covering will also help to resolve previous issues such as increased temperatures incertain areas and glare from the sun.
Reduction in power consumption:

Approx. 2,800 kWh/year

Reduction in CO2 emissions:

Approx. 1 ton/year[Before] Previous skylights[After] Multilayer polycarbonate
skylights to let more light in[Before][After]Sufficient light coming into factoryCommunication with local communities
Participating in tree-planting event
26 employees took part in a tree-planting event organized in the grounds of a local hospital, under the banner“Saving Lives: Planting Trees of Hope.”*1*1 “Saving Lives: Planting Trees of Hope” tree-planting event: A total of around 3,300 people attended the event from thevillage of Kawauchi (Fukushima prefecture), including residents from the cities of Kakegawa and Fukuroi, and planted
23,000 saplings from 27 different species, including Japanese red oak and Japanese blue oak, on a sloped area covering
approximately 7,500m2.

Planting saplings

Rinnai Technica Co., Ltd. 2

CSR Report 2013│Supplemental Data 6

Beautification and cleanup activities
Having signed up to an “Improvement and Cleanup Campaign,” six of our employees took part in activities tomark the 25th anniversary of Kakegawa Station on the Tokaido Shinkansen (bullet train) line, which first opened
on March 13, 1988. A large number of people turned out for the event, and got straight to work cleaning thestation’s historic monuments and walls, and picking up litter around the station, whilst also reflecting on the lastquarter of a century and looking ahead to the future.

Cleaning the station walls

Picking up litter around the station

Rinnai Technica Co., Ltd. 3

CSR Report 2013│Supplemental Data 7

RB Controls Co., Ltd.

Location

Number of employees
Business
Commenced operations
Acquisition of ISO14001 certification

Head office:Kannondo-machi, Kanazawa-shi, Ishikawa
Kanaiwa Factory:
Kanaiwa Higashi, Kanazawa-shi, Ishikawa
Tsurugi Factory:
Oyanagi-machi, Hakusan-shi, Ishikawa
622 (as of March 31, 2013)
Manufacture of gas equipment components
1971
March 2006

Head office

Major production items

Electronic
control units

Kanaiwa
FactoryHigh voltage
units

Bathroomwaterproof TV

Tsurugi
Factory

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

LP gas
(t)

491.0

2.3

237.0

Other fuels(kl)(crude oil equivalent)
24.3

Emissions into the air
CO2 emissions(t-CO2)
2,679

NOx emissions(t)
2.4

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

334.6

16.1

Amount ofintermediate
processing of waste(t)
4.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

314.5

94.0

Substances subject to the PRTR law
Kanaiwa Factory

NumberClass I designated chemical
substance name31
186

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

265
448

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

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

0.0
0.0

0.0
0.0

1,800.0
1,900.0

0.0

0.0

0.0

0.0

0.0

12,000.0

0.0

0.0

0.0

0.0

0.0

3,700.0

RB Controls Co., Ltd. 1

CSR Report 2013│Supplemental Data 7

Substances subject to the PRTR law
Tsurugi Factory

Number

186
448
460

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

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

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

0.0

0.0

2,200.0

0.0

0.0

0.0

0.0

0.0

2,200.0

0.0

0.0

0.0

0.0

0.0

54,000.0

Environmental Initiatives
Environmentally friendly product development (bathroom LED lighting)In the wall lighting market, within which we have a 90% share of system bath lighting,
we have successfully developed an integrated LED product combining both light sourceand power supply. The design focuses particularly on waterproofing, in order toovercome issues with LED lighting such as vulnerability to moisture and short-circuiting.
In fact the product in question won a Good Design Award in 2013.
Reduction in CO2 emissions per light:

Approx. 135 kg/10 years*1*1 Reduction based on the assumption that bathroom lighting is used for two hours a day over thecourse of ten years
Bathroom LED wall lights

Energy and resource saving efforts
Reusing test water
To assess the safety and performance of our products, we run shower tests that require lots of hot water. By
recycling hot water once it has been used, we have managed to reduce both energy and water consumption aspart of shower testing.
Reduction in CO2 emissions:

Approx. 8 tons/year*2

Reduction in water consumption: Approx. 3,700 m3/year
Reduction in gas consumption:

Approx. 3,800 m3/year*2 Based on the assumption that a shower is used 60 times a year

Recycled
shower water(3) Valve
Electromagnetic
three-way valve
Water heater forrecycled water
Hot
water
Water fromshower(1) Valve
Normal water
Normal water(2)Valve

Recycled water

Pump

Valve

Bathtub
Water level maintained at same level using ballcock*Safety measure to prevent the pump from running dry

Valve

Plug
Drain

Ballcock[Shower testing][Environmentally friendly shower test recycling system]

RB Controls Co., Ltd. 2

CSR Report 2013│Supplemental Data 7

Communication with local communities
Exchange onsite at the factory
Our 3rd RB Controls Culture Festival was attended by a total of 270 people, including employees, their families
and local residents. We put on exhibitions featuring company products and groups within the company, andorganized electronics classes, to give everyone an interesting insight into manufacturing.

Company product exhibition

Children having a go at soldering
during an electronics class

RB Controls Co., Ltd. 3

CSR Report 2013│Supplemental Data 8

Rinnai Precision Co., Ltd.

Location
Number of employees
Business
Commenced operations
Acquisition of ISO14001 certification

Head office and Komaki Factory:
Shimobata, Oaza Honjo, Komaki-shi,
Aichi
Kani Factory: Himegaoka, Kani-shi, Gifu
587 (as of the end of March 2013)
Manufacture of gas equipment components
1979
December 2005

Head office and Komaki Factory

Major production items:

Kani Factory

Gas cock partsGas valve parts

Gas control units

Solenoid water valve
and others

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

LP gas(t)

1,244.9

113.5

167.0

Other fuels(kl)(crude oil equivalent)
76.5

Emissions into the air
CO2 emissions(t-CO2)
7,876

NOx emissions(t)
6.3

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)1,838.5

1.5

Amount ofintermediate
processing of waste(t)
1.7

Amount of recycled
waste
(t)

Recycling
percentage(%)

1,835.3

99.8

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

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

Actual value
Maximum Minimum
32
5
8
6.8
‒
‒
18.0
4.4
‒
‒

Mean
25
7.5
13.0
12.0
<1

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

Rinnai Precision Co., Ltd. 1

CSR Report 2013│Supplemental Data 8

Kani Factory
Substance
Amount of discharge
pH
BOD
COD
SS

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

Maximum

Actual value
Minimum

Mean

23
7.1
5.3
‒
2.0

11
6.0
1.0
‒
1.0

15.0
6.5
2.5
1.9
1.2

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

Environmental Initiatives
Energy saving efforts
Reducing energy consumption by reusing cooling water
Washing the gas valves used in tabletop gas stoves requires large volumesof cooling water, all of which is supplied to washing equipment via
pumps.
Although we were planning to install new pumps, to provide fixed
quantities of cooling water for our new washing equipment for cutting, wehave switched to a system that enables us to supply cooling water toseveral pieces of equipment via our existing pumps, thereby reducing

New washing equipment for cuttingenergy consumption.
Reduction in power consumption:

45,000 kWh/year

Reduction in CO2 emissions:

Approx. 17 tons/year

Gas valves

Raising awareness of power saving by introducing an electronic attendance system
Having introduced an ID card-based attendance management system, we are now able to visualize andautomatically monitor the times when employees leave work. This has enabled us to improve operating
efficiency and has also helped to save power.
Reduction in power consumption:

9,140 kWh

Reduction in CO2 emissions:

Approx. 3 tons/year

Attendance management screen(tablet)Checking automatically aggregated figureson the intranet

Rinnai Precision Co., Ltd. 2

CSR Report 2013│Supplemental Data 8

Switching to energy saving lights
We have replaced 514 lights at our Head Office and Komaki Factory with energy saving alternatives, reducing
power consumption by an annual total of 24,360 kWh.
Resource saving efforts
We have installed a semi-dry processing unit, to mix tiny quantities of oil into
the air for application. As a result, we have reduced the volume of oil andwashing fluid (wastewater) that we used previously.

Rinnai Precision Co., Ltd. 3

CSR Report 2013│Supplemental Data 9

RT Engineering Co., Ltd.
Location
Number of employees
Business
Commenced operations
Acquisition of ISO14001 certification

Kamiike-cho, Toyota-shi, Aichi
187 (as of March 31, 2013)
Manufacture of gas equipment andcomponents
1950
March 2006

Major production items

Copper pipe/press components

Grill components
and others

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

LP gas
(t)

198.9

15.3

3.3

Other fuels(kl)(crude oil equivalent)
18.9

Emissions into the air
CO2 emissions(t-CO2)
1,146

NOx emissions(t)
1.0

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

753.0

0.8

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

752.2

99.9

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

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

Actual value
Maximum Minimum
27.5
20
7.2
6.3
2.8
0.8
12
<1
0.5
< 0.5
10.0
1.9
0.04
0.01

Mean
22.5
6.8
1.4
‒
‒
6.0
0.02

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

RT Engineering Co., Ltd. 1

CSR Report 2013│Supplemental Data 9

Environmental Initiatives
Energy and resource saving efforts
Developing a boiler heat recovery system
As part of the coating preparation process, we use a boiler to heat steam to around
140˚C. To make the most of this steam once it has been heated, we have installed awater recovery tank and developed a system whereby steam collected in the tank (asdrain water) is sent back to the boiler to be heated again. This heat recovery system hasenabled us to reduce heating times in the boiler and helped to reduce energy
Boilerconsumption.
3

Reduction in gas consumption:

1,735m /year

Reduction in CO2 emissions:

Approx. 4 tons/year

Water tankCommunication with local communities
We organize factory tours for local junior high school students, as part of their social studies. As well as
explaining the role of pipe components in gas equipment, we also show students actual components being
processed.

Explaining how pipes are processed

Students on a factory tour
(Number of students: 64/year)

Our employees carry out regular cleanup activities along commuting routes and in the area surrounding thefactory. (Number of participants: 12/year)

Cleanup activities along commuting routes

Cleanup activities in the surrounding area

RT Engineering Co., Ltd. 2

CSR Report 2013│Supplemental Data 10

Japan Ceramics Co., Ltd.
Location
Number of employees
Business
Commenced operations
Acquisition of ISO14001 certification

Himegaoka, Kani-shi, Gifu
92 (as of March 31, 2013)
Manufacture of gas equipment components
1981
January 2006

Major production items

Ceramic plates
for burners

Industrial burners

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

134.1

521.0

Other fuels(kl)(crude oil equivalent)
4.1

Emissions into the air
CO2 emissions(t-CO2)2,080

NOx emissions(t)
1.9

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

274.5

100.3

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

174.2

63.4

Substances subject to the PRTR law

NumberClass I designated chemical
substance name

53
80
300
412

Ethylbenzene
XyleneTolueneManganese and its compounds

a. Emissions
into the air

3,000.03,600.0
14,000.0
0.0

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

d. Landfill
at therelevant
office

0.0
0.0
0.0
0.0

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

780.0
730.0
1,800.02,400.0

Air
Equipment

Substance

Baking furnace

Soot and dust
NOx
SOx

National
0.2
400
0.49

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

Actualvalue*20.009
26< 0.01*1 Units of regulation values
Soot and dust: g/m3N
NOx: ppm
Sox: m3N/h*2 Actual values for NOx, Sox, and soot/dust
indicate the maximum measurements versus
the regulation values for the relevant type ofequipment.

Japan Ceramics Co., Ltd. 1

CSR Report 2013│Supplemental Data 10

Water discharge
Substance
Amount of discharge
pH
BOD
COD
SS

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

Actual value
Maximum Minimum
5.9
7.3
5.8
‒
12.0

Mean

4.6
6.6
0.8
‒
4.0

5.4
7.0
3.4
3.5
6.3

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

Environmental Initiatives
Energy saving efforts
Green curtain initiative
We create “green curtains” every year. Specifically, we plant bitter gourds and other climbing plants to create
natural curtains that block out sunlight and keep the inside of buildings cool. *1 The fruit that is harvested is
distributed to employees and their family members to enhance social exchanges. To help these plants grow, we
use ceramic balls we developed and other materials to improve the drainage.
[Seedlings] Bitter gourds, small tomatoes, and winged beans*1 Plants suck up water from their roots and release it from their leaves in the form of vapor. This is called transpiration. We

feel cooler near plants because this vapor draws in the surrounding heat.

Bitter gourd (at an early stage of growth)

A green curtain made of bitter gourds

Small tomato (at an early stage of growth)

A green curtain made of small tomatoes

Japan Ceramics Co., Ltd. 2

CSR Report 2013│Supplemental Data 10

Developing environmental awarenessProduct workshops
We hold 17 product workshops a year, where in-house
lecturers discuss the environmental thinking and the basics
about environmentally friendly products (such as the
combustion mechanism) (e.g., “Why are Eco-Jozu and otherproducts environmentally friendly, and what is behind
them?”). A total of 396 people participated in these.

A workshop on the basics of combustion equipment

Communication with local communities
We participate in local cleanup activities along the Kani River. Our staff members regularly conduct cleanup
activities along commuting routes and the area surrounding the factory. (A total of 44 staff members haveparticipated in these activities.)

Cleanup activities along the Kani River

Cleanup activities along commuting routes

Japan Ceramics Co., Ltd. 3

CSR Report 2013│Supplemental Data 11

Noto Tech Co., Ltd.
Location
Number of employees
Business
Commenced operations

Nakanoto-machi, Kashima-gun, Ishikawa
203 (as of March 31, 2013)
Manufacture of gas equipment components
1990
January 2007

Acquisition of ISO14001 certification

Major production items

Gloss enamel

Enamel components

Resin components

Rice cooker

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

240.8

1,026.0

Other fuels(kl)(crude oil equivalent)
116.0

Emissions into the air
CO2 emissions(t-CO2)
4,318

NOx emissions(t)
3.9

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)2,521.9

336.8

Amount ofintermediate
processing of waste(t)
7.8

Amount of recycled
waste
(t)

Recycling
percentage(%)

2,177.8

86.4

Substances subject to the PRTR law

Class I designated chemical
substance name

Number

31
71
80
265
296
309
405

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

Amount of emission/discharge
a. Emissions b. Discharge c. Discharge
into the air
into public
into the soil
watersat therelevant
office(except d.)
0.0
0.0
0.0
0.0
0.0
0.0
5.9
0.0
0.0

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

0.0
0.0
0.0

0.0
0.0
0.0

200.0
0.0
0.0

0.0

0.0

0.0

0.0

0.0

0.0

6.8
0.0
0.0

0.0
39.0
340.0

0.0
0.0
0.0

0.0
0.0
0.0

0.0
0.0
0.0

0.0
680.0
4,000.0

Air
Equipment

Substance

Baking furnace

Soot and dust
NOx

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

Actualvalue*2
0.004
34*1 Units of regulation values
Soot and dust: g/m3N
NOx: ppm*2 Actual values for NOx and soot/dust indicate themaximum measurements versus the regulation
values for the relevant type of equipment.

Noto Tech Co., Ltd. 1

CSR Report 2013│Supplemental Data 11

Water discharge
Substance
Amount of discharge
pH
BOD
COD
SS
*

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

Actual value
Maximum Minimum
150.0
70.0
7.5
7.1
47.0*
7.0
70.0
15.0
5.0
2.0

Mean
113
7.3
29.5
46.0
3.5

Wastewater quality tests indicated that BOD levels were higher than self-imposed standards (agreed with Hakui City). We therefore
identified the source and took countermeasures. The results of subsequent analysis indicated that water quality was within safe range
under the self-imposed standards.

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

Environmental Initiatives
Resource-saving efforts
We are working to improve the recycling quality of the waste we generate. We have changed the method oftreating the waste lubricant for our pressing machines, which used to be treated as industrial waste, and now
recycle it into a valuable substance.
Pollution-prevention efforts
Emergency drills
We conduct emergency drills so people know what to do in case of an accident. We are reviewing the manuals
that stipulate response procedures. In order to minimize environmental risks, we conduct equipment inspections
and take other preventive measures.

An emergency drill

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

Hands-on training

A tour of the process for manufacturing thecomponents for gas stoves

Noto Tech Co., Ltd. 2

CSR Report 2013│Supplemental Data 12

Techno Parts Co., Ltd.

Location

Number of employees
Business
Acquisition of Eco Action 21

Major production items

Head office:Fukuzumi-cho, Nakagawa-ku, Nagoya-shi, Aichi
Ichinomiya Office: Nishiougaido Aza Toukouji, Ichinomiya-shi, Aichi
Sango Office:Tsunoda, Sango-cho, Owariasahi-shi, Aichi
Ida Office:Ida-cho, Owariasahi-shi, Aichi
Komaki Office:Oaza Mitsubuchi, Komaki-shi, Aichi
461 (as of the end of March 2013)
Assembly and processing of components of heat-energy appliance
July 2011
Components of gas equipment and home electric appliances

Ichinomiya Office

Sango Office

Ida Office

Komaki Office

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

LP gas
(t)

82.0

5.6

0.9

Other fuels(kl)(crude oil equivalent)
0.0

Emissions into the air
CO2 emissions(t-CO2)436

NOx emissions(t)
0.3

Discharge of waste
Amount of waste
generated(t)
89.6

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

A green curtain

The bitter gourds that are harvested are distributed to employees.

Techno Parts Co., Ltd. 1

CSR Report 2013│Supplemental Data 12

Installation of motion sensors
Motion sensors have been installed in lavatories to prevent the lights from staying on when people forget to turnthem off.

A motion sensor

A switch

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

Equipped with a rainwater tank

We separate out used office paper and recycle it into valuable materials.

Techno Parts Co., Ltd. 2