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

CSR Report

15

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Corporate
SocialResponsibility

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Contents
1

CSR Report 2015

3

Top Message

6

Rinnai Group8

Corporate Mission and Vision

10

Medium-Term Business Plan, “Evolution and Succession 2017”12

Rinnai Group CSR

15

The Rinnai Group’s Value Chains and Their Impacts on Society

17

Identifying CSR Material Issues

20

Environmental Initiatives

73

Initiatives Delivering Safety and Peace of Mind

86

Communication with Our Stakeholders

119Management System

125

Major Award Winning History

Supplemental Data:
1. Oguchi Factory7.

2. Seto Factory

8. RT Engineering Co., Ltd.

3. Asahi Factory

9. Japan Ceramics Co., Ltd.

4. Yanagisawa Manufacturing Co., Ltd.

10. Noto Tech Co., Ltd.

5. Rinnai Technica Co., Ltd.

11. Techno Parts Co., Ltd.

6. RB Controls Co., Ltd.

Rinnai Precision Co., Ltd.

CSR Report 2015┃Editorial Policy

CSR Report 2015
Editorial Policy
Rinnai puts out a CSR Report to convey to stakeholders management’s approach to CSR, to describe the activities
undertaken groupwide, and to encourage a deeper understanding of the Group’s operations to as many people aspossible.

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

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 2015—April 1, 2014, to March 31, 2015—but also touches
upon measures implemented and recent activities undertaken prior to fiscal 2015 as well as future businessdirection, targets and plans.

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

1

CSR Report 2015┃Editorial Policy

Publication Schedule
October 2014 (Japanese version), previous: October 2014, next: September 2016 (planned)

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

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CSR Report 2015│Top Message

Top Message
Message from the Chairman
Under the motto of “harmony, spirit, and sincerity,” Rinnai has continued utilizing
heat to provide society with comfortable lifestyles since its foundation in 1920.
Today, Rinnai is a comprehensive manufacturer of heat-energy appliances with
operations in 16 nations worldwide, as well as Japan, and its commitment to society
remains unchanged.
We are currently stepping up various initiatives with top priority on the tenet
that “Quality is our destiny.” In addition to product development and manufacturing,
we are targeting quality improvements across all aspects of our operations, including
distribution, customer relations, and after-sales service, and we are redoubling ourefforts in this regard.
Overseas, we offer products that are matched to local customs, cultures, andneeds, while maintaining our commitment to delivering quality that our customers
demand at home. Accordingly, we work hard to localize our various overseas
operations. This includes a policy in principle of appointing people from local
countries and communities to top positions in our overseas group companies.
Meanwhile, we are focusing on efforts to protect the global environment. As
a comprehensive manufacturer of heat-energy appliances, the Rinnai Group is awareof the huge role it must play in saving energy and helping combat global warming.
For this reason, we emphasize development and proliferation of highly efficient heatand energy products that are friendly to the environment.
In the context of Japan’s low-birthrate, aging society, as well, we recognizethat we are expected to provide safer and more comfortable lifestyles to people of all
generations. Going forward, we will prioritize heat and energy products that are safe,
reliable, comfortable, and environmentally friendly in order to benefit society.

Susumu Naito,
Chairman3

CSR Report 2015│Top Message

Message from the President
With priority on providing top-level “heat and lifestyles,” we will help realize safe, secure,comfortable, and healthy lifestyles, as well as an environmentally friendly society.
Offering hybrid water heaters with heating systems and other highly
efficient products with low environmental impact
The fiscal year ended March 31, 2015 was the final year of the Rinnai
Group’s medium-term business plan, entitled Jump Up 2014. During theyear, we enjoyed good performances in overseas markets despite a recoil inJapan following a rush in demand ahead of the consumption tax hike.
Helped also by the consolidation of Rinnai Indonesia, we achieved our fifth
consecutive year-on-year increase in consolidated net sales, which totaled¥295.0 billion, up 2.8%. However, operating income declined 9.5%, to¥30.7 billion, due to lower earnings in Japan and Australia, which normallyare highly profitable regions for the Group. Nevertheless, we maintained ahigh operating margin of 10.4%.
As a comprehensive manufacturer of heat-energy appliances, weare constantly proposing comfortable, safe, secure, and environmentallyfriendly lifestyles. We believe our business activities in themselves canmake a contribution to society.
For example, we are working to develop and proliferate productsthat generate low carbon dioxide emissions and have minimal
environmental impact. These include ECO ONE, our hybrid water heaterwith heating system that uses a combination of Eco Jozu high-efficiency
water heater and heat pump technologies. In the past year, we did not sell as
many of these products as predicted, due to the impact of the consumption
tax hike. Going forward, however, we will strongly emphasize thesuperiority and significance of such products to society and work hard toensure their widespread popularity.
In April 2015, we launched the third-generation ECO ONE,featuring world-leading levels of energy efficiency. I believe that thisproduct, which is highly efficient and saves energy, will help reduce carbon
dioxide emissions in homes, where we have seen little progress to date. In
addition to these initiatives, we are stepping up our responses to theemergence of “smart houses” and home energy management systems(HEMS) in our pursuit of unrivalled “heat and lifestyles.”Since last year, we have also focused our efforts on “temperatureseamlessness.” Around 17,000 people die in Japan each year due to sudden
temperature changes in bathrooms. By promoting the spread of bathroom
heater/dryers, we believe we can reduce such bathroom-related incidents.

Hiroyasu Naito, President

Quality is our destiny
Constant pursuit of quality improvements“Quality is our destiny” is the basic tenet guiding Rinnai’s activities. Both at home and abroad, we are stepping
up initiatives aimed at improving quality. We share various data about product defects, claims, and the like acrossthe entire Group in order to solve problems in a system that transcends departments. Our overseas operations also
hold vibrant information exchanges with each other related to product manufacturing, with the aim ofincorporating successful cases into their activities. In these and other ways, we strive every day to makequalitative improvements.
With respect to safety-related initiatives, we conduct product inspections via our “Maintenance andInspection System of Long-Term Use Products.” Under this system, we as the manufacturer take the initiative toinspect products intended for long-term use. There are various challenges involved in setting up the system andidentifying products to inspect, but we will strive to ensure the safety of all consumers.
4

CSR Report 2015│Top Message

In 2012, a defect was uncovered in some of our dishwasher/dryer models, and in 2014 a defect was foundin some bathroom-installed fan-forced gas water heaters made by Gastar Co., Ltd. and sold by Rinnai
Corporation. We have been working on a Groupwide basis to undertake inspection, repair, and parts replacementof the defective models. These events caused a major inconvenience to customers, for which we sincerely
apologize. We will continue devoting our utmost efforts until the last machine in fixed.
Workplaces that motivate women to excel
Localizing overseas bases and improving workplace safety awarenessFor some time, the Rinnai Group has worked to create workplace environments that help female employees excel.
As a result, the number of female employees taking advantage of our various systems has increased, and we havereceived acknowledgement and commendations from external parties. In addition to maternity leave, we offer
shortened workweeks to facilitate child-rearing, and some departments are offering work-at-home arrangements
on a trial basis. Going forward, we will strive to create workplaces that enable all employees to work according totheir individual lifestyles.
On the global scene, meanwhile, we will endeavor to improve awareness about worker safety at our basesin emerging nations. In addition to assigning local people to management positions at overseas subsidiaries, theRinnai Group has a fundamental policy of recruiting local staff at each operation and advancing businessaccording to local market conditions. We also place high priority on raising worker safety awareness to the samelevel as in Japan.
With respect to social contribution activities, each of our operations pursues initiatives that match local
circumstances. This year, we will continue making donations to the Nakagawa Canal Restoration and Culture/
Artistic Activity Assistance Project (ARToC10), headed by the Nagoya Urban Institute of the Nagoya Urban
Development Public Corporation. The Nakagawa Canal was once a flourishing shipping route connecting Nagoya
Port to the center of Nagoya City. The aim of the redevelopment project is to reproduce Nakagawa Canal as an
epicenter for citizen interaction and artistic activities, and numerous art-related events have been held as part ofthe project.
Guided by its commitment to “heat and lifestyles,” the Rinnai Group will continue striving to realize asociety that is safe, secure, comfortable, healthy, and environmentally friendly, both in Japan and overseas.

5

CSR Report
Repo 2015

Rinnai GroupJAPAN

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

SOUTH KOREA●Rinnai Korea Corporation

Rinnai Services (MS)Corporation●RB Korea Ltd.

●●RS Korea Ltd.

●Rinnai UK Ltd.

CHINA

●Mikuni RK Corporation●Rinnai Plus Corp.

●Shanghai Rinnai Co., Ltd.
●

●Shanghai RB Controls Co., Ltd.

Rinnai Italia s.r.l.

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

●Yanagisawa Manufacturing Co., Ltd.

Branches: Tohoku, Kanto, Chubu,
Kansai, Kyushu
Domestic sales offices: Hokkaido,
Kita-Tohoku, Sendai, Niigata,
Tokyo, Kita-Kanto, Higashi-Kanto,
Minami-Kanto, Tokai, 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●Hainan Rinnai Minsheng Kitchen Appliances Sales Co., Ltd.

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

●Rinnai Canada Holdings Ltd.

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

●Shanghai Rinnai Thermo Energy Engineering Co., Ltd.

Rinnai America Corporation●Rinnai Taiwan Corporation

Rinnai Hong Kong Ltd.●
Rinnai (Thailand) Co., Ltd. ●●Rinnai Vietnam Co., Ltd.

Rinnai (Malaysia) Sdn. Bhd.
●

Corporate Data

(As of March 31, 2015)●Rinnai Holdings (Pacific) Pte Ltd.
●P.T. Rinnai Indonesia

Incorporated: September 1, 1920

Net Sales by Product (Year ended March 31, 2015)

Net Sales by Region (Year ended March 31, 2015)(Billions of yen)(Billions of yen)

Others¥26.2 billion (–5.4%)

Paid-in capital: ¥6,459,746,974●Rinnai Australia Pty., Ltd.

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

Water heaters¥153.6 billion (+4.6%)

Commercial-use equipment¥9.2 billion (+22.2%)
Home heaters¥14.9 billion (‒10.4%)

Parentheses indicate
percentage changeover previous
corresponding period.

●Gas Appliance Services CorporationJapan¥176.0 billion (–9.5%)

Total¥295.0 billion(+2.8%)South Korea¥31.9 billion (+19.1%)

Kitchen appliances¥90.8 billion (+3.2%)●Jordans NSW Corporation

Number of employees: 9,682 (consolidated),
3.630 (non-consolidated)

United States¥17.7 billion (+14.6%)¥295.0 billion(+2.8%)

Others
¥17.4 billion (+10.3%)

China¥25.3 billion (+32.8%)
Australia¥15.3 billion (+0.5%)

Total

AUSTRALIA

Established: September 2, 1950

Indonesia¥11.1 billion (—)

Parentheses indicate
percentage changeover previous
corresponding period.

Rinnai Brasil ●Heating Technology Ltd.

●Rinnai New Zealand Ltd.

Number of Group companies: 41 (domestic 14, overseas 27)

Water Heaters and Heating Systems

Kitchen AppliancesHome Heaters

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

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.

Seeking to create comfortable living
spaces offering total relaxation and peaceof mind, Rinnai develops a wide array ofhome heaters.

Commercial-Use Equipment

Commercial-use rice cookers, stoves,oven, ranges, industrial ceramics
machines, and others

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

06

Tabletop cookers, built-in hobs (stovetops), dishwashers, ricecookers, built-in ranges, range hoods, and others

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

07

CSR Report 2015│Corporate Mission and VisionCorporate Mission and Vision
Fundamental Concepts

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

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

Schematic Diagram of Company Ideals

8CSR Report 2015│Corporate Mission and Vision

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.

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

9CSR Report 2015│Medium-Term Business Plan, “Evolution and Succession 2017”

Medium-Term Business Plan, “Evolution and Succession 2017”10

CSR Report 2015│Medium-Term Business Plan, “Evolution and Succession 2017”11

CSR Report 2015│Rinnai Group CSR

Rinnai Group CSR
Approach to CSR
Rinnai’s corporate mission hinges on the use of heat to provide society with comfortable lifestyles. This
perspective infuses efforts on a groupwide basis to provide heat-energy appliances with excellent features 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 to develop products thatpeople can use in a safe, comfortable, and efficient manner. In this way, we help people
lead abundant lifestyles.
To offer customers safety and peace of mind, we adhere to the basic tenet that “Quality is
our destiny.” To this end, we pursue a “zero defects” objective when designing, making,and selling our products, to ensure they remain fault-free until they are no longer used by
the customer.
Rinnai’s aim is to deliver products and services that meet climates, lifestyle cultures, andcustoms that differ from Japan. In principle, we focus on local production and local sales inadvancing our overseas business, so that we can help improve the lives of local people
around the world.

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

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CSR Report 2015│Rinnai Group CSR

Environmental Policy
Rinnai’s environmental initiatives are underpinned by the “Basic Philosophy on the Environment,”“Environmental Slogan,” and “Basic Environmental Activities” (“7 E Strategic Initiatives” set out below. Our
efforts extend beyond the development of environmentally responsible products that reduce energy consumption
when in use and initiatives aimed at reducing greenhouse gases.
We recognize how our diverse activities—including the development, procurement, production, sale,and disposal of products—are inextricably linked to the global environment. Accordingly, all Group employees
engage in environmental initiatives across all business domains.
Basic Philosophy on the Environment
Rinnai’s basic philosophy is to embrace environmental protection on a global scale and contribute to society
through the pursuit of excellent, people- and planet-friendly technology, and product development, production,
sales and service infused with a sense of humanity.
Environmental Slogan“Our actions are imbued by the wisdom of many and undertaken with due consideration to the sustainability of apeople- and earth-friendly environment.”

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

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CSR Report 2015│Rinnai Group CSRInternational Assessment of CSR Performance
Rinnai has been selected for inclusion in the FTSE4Good Global Index, a worldwide socially responsible
investment (SRI) index, for ten consecutive years since 2004.

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CSR Report 2015│The Rinnai Group’s Value Chains and Their Impacts on Society

The Rinnai Group’s Value Chains and Their Impacts on Society
Social Impacts and Activities of the Rinnai Group
Recognizing that our activities have a variety of impacts on society, we pursue a range of measures to fulfill oursocial responsibilities in every area in which we do business.
Input
Rinnai Group
Value Chain▼

Main Concerns

Main Activities of
the Rinnai Group- Depletion of resources- Climate change- Atmospheric pollution- Design quality- Development of energy-saving water andspace heating products, which accountfor over half the energy consumed in thehome- Development of green products using
combustion and control technologies toreduce environmental impact on the
output side
- Activities to improve design quality andeliminate defects- Factory floor quality improvement andevaluation testing in accordance withstrict standards covering all kinds ofscenarios- Resource depletion- Climate change- Atmospheric pollution- Water pollution- Soil pollution- Hazardous chemicals- Conflict minerals- Stable procurement- Quality of procuredparts- Pursuit of improvements with suppliers
to improve flow of goods from partsprocurement to manufacture anddistribution- Collection and management of
information on control of hazardous
chemicals in collaboration with suppliers
and group companies- Improvement of quality through supportof onsite improvements by suppliers- Resource depletion- Climate change- Atmospheric pollution- Water pollution- Soil pollution- Hazardous chemicals- Noise- Manufacturing quality- Improvement of productivity andreduction of energy consumption bystreamlining manufacturing- Improvement of quality through in-groupproduction and integrated production of
key safety components (for controllinggas, water, electronics, etc.)- Improvement of quality through in-houseproduction of key production facilities,dies, and information systems- Activities to improve quality on thefactory floor

OutputInput
Iron, copper, stainless steel,brass, aluminum, plastics,
rubber, electricity, gas, fuel,water, paper, etc.

Development&
Design▼OutputCO2, NOx, solid waste,
wastewater, etc.

Input
Diesel fuel/gasoline,
electricity, gas, water, etc.

Procurement▼
OutputCO2, NOx, solid waste,
wastewater, etc.

Input
Iron, copper, stainless steel,brass, aluminum, plastics,
rubber, electricity, gas, fuel,water, paper, etc.

Production▼
OutputCO2, NOx, solid waste,
wastewater, etc.

15

CSR Report 2015│The Rinnai Group’s Value Chains and Their Impacts on Society- Resource depletion- Climate change- Atmospheric pollution- Noise- Misdeliveries- Improvement of fuel efficiency byshortening transportation distances (e.g.,
by changing routes and consolidating
distribution centers) and encouraging
eco-driving- Adoption of packing that is easier tounload and move
- Improvement of logistics quality by insourcing logistics functions- Resource depletion- Climate change- Installation quality- Development of energy-saving water andspace heating products, which accountfor over half the energy consumed in thehome- Improvement of fuel efficiency byencouraging eco-driving of company
vehicles, etc.
- Popularization of products contributing tosafety and security in the home (e.g.
cooking stoves and bathroom
heater/dryers fitted with safety sensors- Training and instruction to improve
quality of installation work

Input
Diesel fuel/gasoline,
electricity, gas, water, etc.

Logistics▼
OutputCO2, NOx, wastewater, etc.

Input
Diesel fuel/gasoline,
electricity, gas, water, paper,
etc.

Sale
&
Installation▼
OutputCO2, NOx, solid waste,
wastewater, etc.

Input
Product UseandAfter-sales
ServiceElectricity, gas, water, paper,etc.

- Resource depletion- Climate change▼- Equipment failures

OutputCO2, NOx, wastewater, solid
waste, etc.

- Incomplete combustion- Residential fires- Bathroom accidents- Proposal of sustainable, comfortable,
green lifestyles through use of energysaving products- Provision of reminders and information to
help avoid accidents caused by misuse or
careless use of products- Provision of information to reduce
accidents in the home

Input
Diesel fuel/gasoline,
electricity, gas, water, etc.

Disposal▼
OutputSolid waste, CO2, NOx,
wastewater, etc.

- Resource depletion- Climate change- Water pollution- Soil pollution- Application of Design for theEnvironment, e.g., to make products
easy to disassemble, in accordance withproduct assessment standards- Reduction of waste emissions andmaintenance of zero emissions (zerowaste disposal by landfill)

The value chain is the chain of business activities and processes undertaken by a company to generate and deliver value (products andservices) to the customer.

16

CSR Report 2015│Identifying CSR Material Issues

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

17

CSR Report 2015│Identifying CSR Material Issues

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

18

CSR Report 2015│Identifying CSR Material Issues

Focus of initiatives
Environmental initiatives
CSR Material Issues- Energy consumption- CO2 emissions

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

Target Area and Stakeholders
Target area: Global (Main focus of initiatives: Japan)
Target stakeholders: All
Details of Initiatives
We intend to develop and encourage households to use water heaters and heating units with an emphasis onenergy saving and environmental performance, in an effort to reduce energy consumption and reduce household
CO2 emissions.

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

Reducing kitchen-fires and fatal bathroom accidents is naturally an
important priority alongside eliminating accidents resulting from productdefects.

Target Area and Stakeholders
Target area: Japan
Target stakeholders: Customers
Details of Initiatives
We are working towards achieving “zero defects” by eliminating defects at every stage of the product lifecycle—
from development, production, and sale through to obsolescence—and pursue a range of activities to publicize
information and raise awareness of preventing accidents in the home.

19

CSR Report 2015│Environmental Initiatives

Environmental Initiatives
Targeting Proliferation of ECO ONE, which Dramatically
Reduces Carbon Dioxide Emitted from Homes
Rinnai’s ECO ONE hybrid water heater with heating system received a major energy efficiency award in 2013 inrecognition of its exceptional environmental performance. Through ECO ONE, which dramatically reducescarbon dioxide emitted from homes, we are working together with customers to reduce environmental impacts. In
this section, we introduce environmental initiatives in our core business through the voices of people involved in
ECO ONE’s design, installation, and sales—and are thus key to its proliferation.

138% Primary Energy Efficiency: Overwhelming Lead over Other Companies
In the average home, water heating and room heating account for more than half of energy consumed*1. Finding
ways to reduce carbon dioxide emitted from homes, therefore, will play a major role in preventing global
warming. Committed to the proliferation of ECO ONE, which greatly reduces energy consumption and carbon
dioxide emissions, we made various improvements to our lineup with the launch of the third-generation ECO
ONE*2.
According to Mr. Toshihiro Tokoro of Rinnai’s Research & Development Headquarters, “With the third
generation, we sought to improve environmental performance and resolve issues related to installation.” We haveraised the primary energy efficiency*3 from 129% for existing models to 138%, the highest in the industry.

20

CSR Report 2015│Environmental Initiatives*3 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.

One more environmental performance feature

Employs R32 Next-Generation Coolant
The third-generation ECO ONE uses R32, a chlorofluorocarbon alternative, as the coolant for its heat pump.
Containing zero ozone layer destruction substances, R32 has a global warming potential (GWP) of around onethird compared with conventional R410A coolant.
Global warming potential (GWP): Indicator used to compare magnitude of greenhouse effect of different substances. Represents a relative value when
100 years of carbon dioxide emission is standardized as one unit. Greenhouse effect increases in proportion to the GWP figure.

21

CSR Report 2015│Environmental Initiatives

Making installation easier

Using Feedback from the Front Lines to Make Improvements
According to Mr. Tokoro, “This time, our top priority for improvement was to make installation easier.” Practicallyall home equipment, including water heaters, comes in containers selected by the contractor or builder. The issue
of installation difficulty gets avoided, no matter how good the environmental performance is. “So we incorporated
feedback from the installation front lines into our product development,” says Mr. Tokoro.
The main modification resulted from a reassessment of product configuration. We changed theconfiguration so the main components—tank, gas water heater, and heat pump—could be arranged according toinstallation site area and layout. This has enabled set-up in small and narrow spaces where installation waspreviously impossible. It can even be installed in locations with cramped access points. In addition, test operationof ECO ONE, which previous required manual procedures, can now be done with a single switch. In these and otherways, we have addressed any foreseeable issues as far as possible.

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CSR Report 2015│Environmental Initiatives

Dispelling the “difficulty” myth!

Reducing Installation Errors through Direct Visual Understanding“ECO ONE is a hybrid system that uses a mixture of gas for energy and atmospheric heat for the heat pump. So it
is easy to assume that arranging and installing the systems components would be difficult. The key was how toresolve this issue.” These are the words of Mr. Atsushi Goto, from the Installation Management Group, Marketing& Sales Headquarters. So we simplified the installation manual and color-coded the pipe connection points.
Before launching ECO ONE, we held a seminar to which installation technicians from our nine sales bases around
Japan were invited. Says Mr. Goto, “We pointed out caution points and other matters pertaining to installation,familiarized everyone with the product, and otherwise sought to make installation easier. The number of phoneinquiries from technicians since the seminar has since declined.”

Embracing the Trend for Energy Efficiency in the Home
In Japan, there is a progressive movement to force residential structures to conform to energy efficiency standards
for buildings by 2020. When building a new house, owners are encouraged to install energy-saving equipment andappliances, such as high-efficiency water heaters, in addition to effective thermal insulation. Going forward, we
predict that the introduction of energy efficient equipment via contractors and builders will gain renewed
momentum.
According to Mr. Kiyoshi Shibata, from Rinnai’s Marketing & Sales Headquarters, “ECO ONE contributes
to savings in water and heating, which account for around half of energy consumption in the home. I believe it will
become a key supporting factor in saving energy at home.”
Full liberalization of Japan’s electric power sector will start in 2016, followed by the gas sector in 2017. In
this context, competition in the household energy market will intensify, while prices will diversify and barriers
between energy sources will disappear. ECO ONE can demonstrate a strong advantage in utility cost savings. What
will ECO ONE’s ideal positioning be in light of these trends?

23

CSR Report 2015│Environmental Initiatives“In addition to energy efficiency in water heating, we want to elevate ECO ONE’s profile as a room heating
system, including floor heating,” says Mr. Tokoro. Adds Mr. Shibata, “Rinnai’s mission is to use heat to provide
comfortable lifestyles. We want to spread the popularity of hot-water-based heating, which uses heat from hot water
to warm up rooms in a body-friendly manner.” Similarly, we want to promote ECO ONE as a room heating system.
To achieve this, we need to upgrade the terminal devices so that hot water is used for floor heating, roomheating/drying, and the like. At the same time, we need to convey the advantages of hot-water-based heating to thebroader public.
“For those who feel the need to save energy and reduce utility costs, continuous austerity is no longer
necessary. ECO ONE allows you effortlessly save energy and lower utility costs, giving you access to comfortableroom warming without a big hit on your utility bills. I want to broadly emphasize these appealing factors,” says Mr.
Shibata.

Customer feedback

My ECO ONE ExperienceCan be installed in narrow spaces.
Relieves my family from cold hands and feet and dry skin, making life more comfortable.
Ms. F, a customer in Aichi Prefecture
I was initially concerned that our new house was so cramped, but then I was
relieved that ECO ONE could be installed in narrow spaces. The floor heatingin the living room keeps my feet nice and warm, and my wife, who is sensitive
to the cold, says life is more comfortable now. My daughter is also happy
because, unlike air conditioning, there is no direct air flow, which keeps her
skin and throat from drying out. The hot-water-based bathroom heater/dryer
also plays a big role. Now, we can wash our clothes without worrying about
the weather.

24

CSR Report 2015│Environmental Initiatives

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

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

25

CSR Report 2015│Environmental Initiatives

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

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

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

Combustion burner test

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

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

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

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

26

CSR Report 2015│Environmental Initiatives

Example of CO2 Emissions Reduction in the Manufacturing Process
CO2 emissions reduced by changing the fastening method of the secondary heat exchanger

Fastening method
Fastening energy
CO2 emissions

Before Improvement

After Improvement

Welded part

Caulked machining part

Welding
0.029kWh0.0110kg-CO2

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

Lighter Products Enhance Workability (Work Efficiency) and Reduces Energy
Consumption in the Logistics Process
Reducing the weight of a water heater by 3.5kg compared with conventional models has made it easier to wall-mountthe main body and reduce the load on external walls. A lighter product has also contributed to improved loading
efficiency during the logistics process, resulting in a 10% reduction in energy consumption.

27

CSR Report 2015│Environmental Initiatives

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

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

High-Efficiency Eco Jozu Water Heaters: Heats Water While Consuming Minimal Energy

Heat efficiency boosted from around 80% to 95%!

RUF-E2405AW Series

28CSR Report 2015│Developing Environmentally Conscious Products

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

Energy and Resource Saving Initiatives
Bath“Eco One” Hybrid Water Heater with Heating Systems
Saving energy- Achieves 138% primary energy efficiency when heating water, byboiling water within the most efficient temperature range (lowtemperatures), learning daily usage patterns and supplying theideal amount of hot water with no waste- Power-saving option to stop the heat pump from running andswitch configuration to gas only at peak times

Made in JapanECO ONE
Hybrid water heater with heating system

Resource saving- Approximately 20kg lighter (reduction of approximately 20% compared to standard Rinnai product)- Miniaturized heat pump (reduction of approximately 25% compared to standard Rinnai product)
Environmental performance- R32 used as refrigerant for heat pump (approximately one third the global warming potential of conventional
refrigerant (R410A))
Remote control for added comfort and convenience- Equipped with features to enable users to effortlessly save energy, including an automatic mode that optimizes
hot water depending on usage, and an ECO notification feature to raise levels of eco awareness29

CSR Report 2015│Developing Environmentally Conscious Products

Heat Source for Gas Water Heaters with Heating Systems
Saving energy- Thermal efficiency
Water heating: 95%
Bath heating: 87%- Standby power: 1.1W or lessFeatures
Equipped with three functions:
Hot water + Bath heater + Heating
Made in Japan

Environmental performance- Low NOx emissions: 60ppm or lessResource saving- Approximately 3kg lighter (reduction of
approximately 8% compared to standard Rinnai
product)

RVD-E2405AW2 Series
Gas water heaters withheating systems

Gas Water Heater with Bath-filling System
Saving energy- Thermal efficiency
Water heating: 95%
Bath heating: 92%- Standby power: 0.9W or lessFeatures
Equipped with two functions:
Hot water + Bath heater
Made in Japan

Environmental performance- Low NOx emissions: 60ppm or lessResource saving- Approximately 3.5kg lighter (reduction of
approximately 11% compared to standard
Rinnai product)

RUF-E2405AW Series
Gas water heater with bathfilling system

Dedicated Gas Water Heater
Saving energy- Thermal efficiency
Water heating: 95%- Standby power: 1.0W or lessFeatures
Equipped with one function:
Hot water
Dedicated water heater

Environmental performance- Low NOx emissions: 60ppm or lessMade in Japan

Resource saving- Approximately 2.5kg lighter (reduction of
approximately 9% compared to standard Rinnai
product)

RUX-E2403W Series
Dedicated gas water heater

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CSR Report 2015│Developing Environmentally Conscious Products

Dedicated Gas Water Heater (for Commercial Use)
Saving energy- Thermal efficiency
Water heating: 95%

Features
Equipped with one function:
Hot water
Dedicated water heater

Environmental performance- Low NOx emissions: 60ppm or lessMade in Japan

Resource saving- Approximately 6kg lighter (reduction of
approximately 9% compared to standard Rinnai
product)

RUXC-E5000MW Series
Dedicated gas water heater(commercial-use)

Topics Winner of the Chunichi Shimbun Award
We were winners of the Chunichi Shimbun Award at the IMS2014 Resource Recycling Manufacturing Symposium*for our development of an eco-friendly water heater with bath-filling system.
Outline of Award Winning Activity
We reexamined every one of the 1,200 or so parts used, all the way down to the smallest screw, to develop theindustry’s lightest water heater (as of March 2014).
*Organized mainly by the Nagoya Industries Promotion Corporation, the purpose of this event is to showcase research undertaken by
manufacturers associated with the Chubu region to recycle resources, reduce the impact on the environment, and combat climatechange, and to recognize examples of outstanding practice in these fields.

Parts used to make the eco-friendly water heaterwith bath-filling system(from our R-Quality catalog)
Presentation

After the ceremony

31

CSR Report 2015│Developing Environmentally Conscious Products

Bathroom TVs
Saving energy (15 inches)- Annual power consumption: 31kW/year(reduction of approximately 63% compared to standard Rinnai
product)- Energy efficiency standard achievement rate: 141%
- Standby power: 0.4W or lessMade in Japan

DS-1500HV(B)
15-inch bathroom TV

Saving energy (12 inches)- Annual power consumption: 26kW/year(reduction of approximately 13% compared to standard Rinnai
product)- Energy efficiency standard achievement rate: 169%

Made in Japan

DS-1201HV(A)12-inch bathroom TV

Living Room
Gas Fan Heaters
Saving energy- Eco-mode function prevents a room from becoming too hot by sensing theroom temperature and automatically lowering the temperature once the target
temperature has been reached- Reduces gas consumption by up to 11% compared to existing models (whenrunning in eco-mode for approximately two and a half hours after reaching thetarget temperature)

Made in Japan

Resource saving- Approximately 3kg lighter (reduction of approximately 22% compared tostandard Rinnai product)- 30mm narrower and 54mm lower profile (reduction of approximately 16%
compared to standard Rinnai product)

RC-N4001NP
Gas fan heaters* Based on comparison between the new RC-N4001NP and the previous RC-L4001NP

Fan-forced Gas Heater
Saving energy- Standby power: Reduced 3W ⇒ 0.8W
- Eco-mode to prevent a room from becoming too warm

Made in Japan-

RHF-1005FT
Fan-forced gas heaters

32

CSR Report 2015│Developing Environmentally Conscious Products

KitchenTabletop Cookers
Saving energy- Grill gas consumption reduced by approximately 13%

Made in Japan

Resource saving- Approximately 1.5kg lighter (reduction of approximately 18%
compared to standard Rinnai product)
RT6-4JT
Tabletop cookers

Dishwashers1
Water savings- Equipped with a range of washing modes and two dedicated washingnozzle pumps (one top and one bottom) to strike a balance between
cleaning performance and saving water- Reduces water consumption by up to 53% in water-saving modecompared to existing models2

Made in Japan

1 Developed in conjunction with TOTO Ltd.
2 Based on comparison between the new RKW-F402C and previous model operatingin standard mode

Jet type rotary nozzle
above and below

RKW-F402C
Dish washer and dryer

MY HOB Series of Built-in Gas Hobs for Overseas Markets
Resource saving- Burners approximately 1kg lighter thanks to eco
design using lighter parts (reduction of approximately
74% compared to standard Rinnai product)- Unit specifications to enable optimization of different
burner numbers and layouts, helping to reduce energy
consumption during processing at the manufacturing
stages and the amount of steel used (reduction of
approximately 24t)

Made in Japan

RB-3311N-GBS

RB-3312S-GBS

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

RB-6323S-GBST

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

RB-9314S-GBS

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

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CSR Report 2015│Developing Environmentally Conscious Products

Packing
We are increasing our use of easily recyclable cardboard and working to reduce the weight and volume of packaging
used by expanding our use of returnable packaging and recycling packaging materials.

Example 1: Returnable Packaging
We use returnable packaging for selected water heaters. Integrating external packaging and padding material has
reduced the number of parts and reduced the overall mass by approximately 50%. We were a prizewinner in the
Large and Heavy Duty Equipment Packaging Category at the 2014 Japan Packaging Contest.
・Reduction in packaging materials: 2.5kg/unit (reduction of approximately 50% compared to standard Rinnai product)

Example 2: Built-in hob (tabletop)
We redesigned the packing layout to reduce the amount of cardboard used.
By using fewer types of packaging, we have also made unboxing and assembly easier.
・Reduction in cardboard used: 1,830g/unit (reduction of approximately 20% compared to standard Rinnai product)

Packaging for fitted kitchen gas hob

34

CSR Report 2015│Developing Environmentally Conscious Products

Example 3: Fan heater
We reduced the amount of cardboard used by doing away with the bottom tray and using molded pulp for the top
padding.
・Reduction in cardboard used: 370g/unit (reduction of approximately 20% compared to standard Rinnai product)

Fan heater packaging

Example 4: Gas stove (New Zealand)
Rinnai New Zealand has developed a new kind of packaging for gas stoves that can be used by customers and theirfamilies after delivery, rather than thrown away as in the past. The outer box containing the stove can bereassembled into a castle for kids to play in, and even features turrets and a functioning door.
This design won third prize in the Graphic Category of New Zealand’s Best Design Awards.

On show at an exhibition

35

CSR Report 2015│Developing Environmentally Conscious Products

Recycling
Product Recycling Initiatives
We design for the environment following our own product assessment regulations in order to increase our recycling
rate.

Examples of Environmentally Conscious Design-

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

Monitoring of Recycling of End-of-life Products
At least 80%-90% of the materials used to make gas appliances consist of recyclable materials such as iron and copper.
Gas appliances that have reached the end of their useful lives are collected and disposed of through two channels: by
local authorities in the case of appliances that require no installation work, and by contractors in the case of appliancesthat do require such work.
The Environmental and Recycling Action Committee formed by the Japan Industrial Association of Gas andKerosene Appliances, of which we are a member, regularly surveys the state of disposal of end-of-life gas and oil
appliances. In addition to using questionnaires, the committee conducts actual trials at recycling plants as necessary,and confirms and shares information on the state of disposal. Surveys in fiscal 2014 confirmed that end-of-life gas
and oil appliances are being properly disposed of and that the recycling rate is being kept high. These findings arebeing put to use in the design and improvement of products.

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

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

36

CSR Report 2015│Environmental Management System with our business partners

Environmental Management System with Our Suppliers
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.30]

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, andPractical training(Shanghai Rinnai Co.,sharing information throughout the group.
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.

Working as a Team with Suppliers to Improve the Environment
We are working with our suppliers to improve the flow of products and materials at every stage of our activities—
from procurement through to production and distribution—so as to mitigate our impact on the environment.

37

CSR Report 2015│Environmental Management System with our business partners【Example1】 Devising Environmentally Friendly Screws
Having taken a closer look at the tens of thousands of tiny screws we use at thefactory every day, we worked with suppliers to devise screw specifications tosuit heat-energy appliances. We started by examining the properties andqualities of each individual component. Through measures such as revising
effective screw length, we managed to improve performance and reduce theweight of each screw. This in turn has helped to reduce time spent inserting
screws and improved productivity (by reducing energy consumption).
We have also revised our existing packing methods to make products easier toinsert and remove. As well as reducing packaging materials, this has made iteasier to sort and ship screws.
-

Reduction in raw materials: Approx. 2t per year
Reduction in CO2 emissions: Approx. 2t CO2 per year
Reduction in packaging: Approx. 2t per year

Inserting screws

Revising packing methods【Example2】 Making the Packing Used in All Our Water Heaters Greener
Any wastage during manufacturing processes, whether in the form ofwasted materials or wasted work, is bad both for the environment andproductivity. We therefore thoroughly reviewed onsite management
conditions, such as by making checks of areas where physical waste is
kept
Focusing on how the packing used in all our water heaters ismade, we worked with our suppliers, designers and, on occasion, theworkers involved with each process, to reduce the considerable quantityof material that is lost during production. We improved not only
individual processes but also the linkages between them, resulting in
more efficient logistics as well as manufacturing. We also slashed theamount of waste produced by moving away from the conventional
practice of packaging everything in plastic bags.

Discussion about improvement ofavailable percentage of materials- Reduction in CO2 emissions: approximately 2t-CO2/year- Reduction in waste emissions: approximately 7t/year[Green change 1] Cutout layout redesigned
The cutout layout was completely redesigned and multiple processes were integrated to minimize material waste.
The result was a 30-point improvement in the material yield ratio.

38

CSR Report 2015│Environmental Management System with our business partners[Green change 2] Gluing and cutout lines integrated[Green change 3] Packing method changed
We changed our packing method to reduce the amount of packaging waste produced.
This has streamlined sorting and shipping work and so improved production efficiency.

39

CSR Report 2015│Environment-Conscious Monozukuri

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

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

40

CSR Report 2015│Environment-Conscious Monozukuri- As we have been unable to gather sufficient performance data for some of our overseas facilities to date, we areplanning to restructure our global information gathering framework, so that we can utilize information currently at
our disposal to reduce environmental impact in the future. Input/output data does not include environmental impact at
the logistics/sales, usage, procurement or disposal stages.
- CO2 conversion factors used to calculate CO2 emissions are based on Ministry of the Environment guidelines for the
calculation of greenhouse gas emissions by business operators (July 2003). Figures for natural gas (13A) and methane
however are based on those provided by the relevant supplier.
- Heat conversion factors are calculated based on standard heat values according to energy source, published by the
Agency for Natural Resources and Energy (February 2002). Figures for natural gas (13A) and methane however are
based on those provided by the relevant supplier. The figure used for electricity is 9.84MJ/KWh.

CO2 conversion factors (kg CO2/unit)
Electricity

0.378

kg-CO2/kWh

13A

2.197

kg-CO2/m3

LPG

3.000

kg-CO2/kg

Butane3.000

kg-CO2/kg

Methane2.020

kg-CO2/m3

Heavy oil

2.710

kg-CO2/L

Kerosene

2.489

kg-CO2/L

Light oil

2.619

kg-CO2/L

Gasoline

2.322

kg-CO2/L

Gas

Oil

Heat conversion factors (MJ/unit)
Electricity

9.84

MJ/kWh

13A

46.10

MJ/m2

LPG

50.20

MJ/kg

Butane

50.20

MJ/kg

Methane

40.90

MJ/m2

Heavy oil

39.10

MJ/L

Kerosene

36.70

MJ/L

Light oil

38.20

MJ/L

Gasoline

34.60

MJ/L

Gas

Oil

41

CSR Report 2015│Environment-Conscious Monozukuri

Environmentally Friendly Product Manufacturing
Seeking to further enhance the flow of goods, from procurement of materials and parts to merchandising anddistribution, we emphasize environmental improvements across the entire value chain. Below is an example of ourefforts in this area.

<Example>
Rinnai uses more than 17 million wire harnesses annually in its products, as well as connectors to link those harnesses.
Here, we speak to the Rinnai person in charge of manufacturing wire harnesses and connectors, as well as to business
partners.

Overview of Initiative
Increasing the color variation of connectors used to link harnesses enabled us to prevent connection errors that
occurred in the past. Other initiatives, such as changing the coloring of connectors from painting to original-color
dyeing, have greatly reduced environmental impacts and enhanced efficiency. We have also switched to low-waste
packaging for materials and parts and worked in other ways to improve the entire flow, including distribution.

Joint development of next-generation connectors in 10 colors (left) and assembling connectors
Main environmental benefits: Discarded waste: Down 21 tons/year
Water use: Down 19,000 liters/year

Making Next-Generation Connectors
In this initiative, we emphasized “total optimization” rather than “partial
optimization” by working in alliance with all related companies andindividuals in making improvements. Having identified the needs ofpeople on the ground, we scrutinized the entire flow, from materials to
distribution, and conceived various techniques that would lead toenvironmental improvement and better efficiency. Then, we
communicated with business partners, including makers of connectors,
harnesses, electric cable, and the like, enabling us to bring together theiropinions with those of our manufacturing and design departments. The
outcome was better connectors for the next generation.
I believe such environmental initiatives across the value chain
will lead to more sustainable growth of the Company in the future.

Satoru Tsuge, Seto Factory

42

CSR Report 2015│Environment-Conscious Monozukuri

Together, we created connectors not available elsewhere that match
Rinnai’s specifications in terms of the environment, quality, productivity,
and the like.
There were many factors that would not have come to mind if
acted alone, so as a manufacturer we made new discoveries that changed
our perspective. We hope to continue making connectors that “connect
people.”Ayako Ota (left) and Asuka
Matsumoto, Molex Japan Co., Ltd.,Business partner

43

CSR Report 2015│Environment-Conscious Monozukuri

Efforts to Prevent Global Warming
Promoting Energy Saving Measures at Domestic Facilities
As a “specified business operator” under the revised Act Concerning the Rational Use of Energy, we are pursuingenergy efficiency improvements in line with an established energy management policy and targets.
Carrying on from last year, we pursued power-saving activities at all our operations with a focus on reducing
electricity consumption. Use of lighting, air conditioning, and other power-consuming devices was also further
rationalized. As a result, 1.49 million kWh of power was saved in the summer.

Results of Activities
Upgrades/new installations(investments)

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 or switch to standby mode if left unused for
prolonged periods, reducing usage of photocopiers (double-sided printing,using condensed printing settings), reducing usage of drinks machines, etc.

Optimization(manufacturing)

Optimizing set pressure and start/stop times on compressors, improving
furnace efficiency in order to reduce operating times, reusing exhaust heatfrom boilers, 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”, using green
curtains and bamboo screens to reduce strain on air conditioning, etc.

Summer Power Savings
Fiscal year
Power saved (10,000kWh)
Power-saving activities
Power saving rate (%)

2012

2013

2014

2015

(Apr. 2011-Mar. 2012)(Apr. 2012-Mar. 2013)(Apr. 2013-Mar. 2014)(Apr. 2014-Mar. 2015)

42
228
6.6

129
390
15.8

135
399
16.4

149
424
18.1

*Summer power-saving period: June to September (July to September in fiscal 2011 only)*Power saving rate: power saved relative to total power consumption during the same period in fiscal 2010

Summer power saving poster

Energy-saving enhancements made tomelting and casting furnaces(Rinnai Precision)

Cafeteria lighting converted to LED(RT Engineering)44

CSR Report 2015│Environment-Conscious Monozukuri

Green curtains of cherry tomato plants(Japan Ceramics)

Environmental patrols to eliminate airleaks (Yanagisawa Manufacturing)

Karakuri kaizen innovations to perform
work without using energy(Oguchi Factory)

Promoting Energy Saving Measures at Overseas Facilities【Example 1】 Installation of Hot Water Circulation System Built in-House
Developing water heaters requires heavy use of energy to test their performance. As long as this does not affectthe test results, therefore, switching to systems that make more effective use of energy during testing can lead tomajor energy savings.
When it expanded its employee changing rooms, Rinnai Brasil Heating Technology also built its own hot water
circulation system to supply hot water generated during durability testing of water heaters to the showers.
Recycling thermal energy in this way has enabled energy consumption to be cut despite the increase in the numberof showers.
- Reduction in electricity consumption: approximately 30,000kWh/year- Reduction in gas consumption: approximately 3,000m3/year- Reduction in CO2 emissions: approximately 18t-CO2/year

Shower cubicles in the newchanging room

Rinnai Brasil

REU-1602 FEH water heater (left)
and REU-2402 FEH water heater【Example 2】 Use of Natural Energy Sources
Shanghai Rinnai has installed solar panels on the roof of its factory to makeeffective use of energy. The water heated by heat collecting panels is supplied
to the employee showers, while the electricity generated is used to power
lighting indoors.
- Reduction in electricity consumption: approximately 4,500kWh/year- Reduction in gas consumption: approximately 6,000m3/year- Reduction in CO2 emissions: approximately 15t-CO2/year
Solar panels

45

CSR Report 2015│Environment-Conscious Monozukuri【Example 3】 LED Lighting Conversion
On the assembly line at Shanghai Rinnai, the fluorescent lighting used to date was converted to LED. This has
improved workspace illumination, enhanced the working environment, and reduced energy consumption.
- Reduction in electricity consumption: approximately 90,000kWh/year- Reduction in CO2 emissions: approximately 34t-CO2/year

With fluorescent lighting

With LED lighting46

CSR Report 2015│Environment-Conscious Monozukuri

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

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

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

Action at Plants and Offices【Example 1】Action to Cut Food Waste
Various activities are being pursued to cut emissions of food waste (kitchen refuse) from employee cafeterias.
- Setting and posting of monthly targets for cutting food waste- Designation of certain days as “no food waste days” when no waste should be produced- Surveying of food wastage at lunchtimes and revision of number of meals prepared daily- Discontinuation of preparation of additional meals- Use of photos instead of actual samples to illustrate items on menu

Actual sample menu

Photos used to illustrate menu

47

CSR Report 2015│Environment-Conscious Monozukuri【Example 2】 Cardboard Consumption Reduced by Eliminating Use of Large Boxes(at Parts Center)
Cardboard consumption has been reduced by 3 tons/year by eliminating the practice of packing boxes inside larger
boxes.

Packaged inside larger box

Packaged without using larger box【Example 3】 Recycling of Shredder Dust
Emissions of waste paper are reduced by recycling used paper (shredded dust) into padding material for packaging
service parts at our plants and offices.

Waste paper is shredded

Shredded paper (waste) is usedas padding material in packages

Improvement of Pproduction Process Yields
We are working to increase effective utilization of pressed parts (materials) by a number of strategies in order toreduce the impact on the environment. These include:- Modification of pressing processes and die constructions to enable stable production of quality products- Use of computer-aided engineering (CAE) to minimize scrap emissions and trim the dimensions of materials used

Improvement of Recycling Quality
We are working to raise the “quality” of our recycling in order to make more effective use of waste as fuel and otherresources. We are doing this in several ways, including by revisiting how materials are sorted and collected, and byshifting from thermal recycling to material recycling.

48

CSR Report 2015│Environment-Conscious Monozukuri

Industrial Waste Disposal
We rigorously screen waste disposal contractors before signing contracts,
including checking business conditions and making onsite visits. To ensure thatwaste is being disposed of properly, we send representatives to visit contractors
every year, to carry out visual confirmation and exchange information on matterssuch as types of waste, waste manifest management for disposal methods andconditions, and standards of waste disposal. In fiscal 2015, we confirmed that 56
contractors were conducting waste management in an appropriate manner.

Visiting disposal sites

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

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

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

Making Paint Processes Environmentally Friendlier
To comply with the Water Pollution Control Act, we have reviewed our selection of chemicals and switched tousing ones that contain no hazardous substances. This has also led to a reduced risk of soil pollution in the eventof a leak.

Chemical Management with Business Partners
See page 37 “Reinforcement of Chemical Management”.

49CSR Report 2015│Environment-Conscious Monozukuri

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

Emergency response drill

Environment-Focused Equipment Inspection
To prevent accidents that would impact the environment, we identify equipment with the potential to adversely
affect the environment and run concerted environment-focused inspections on these pieces of equipment on anannual basis. We make every effort to preempt and prevent serious accidents that could impact on the environment,
through measures such as inspecting individual items of equipment, checking that measuring instruments arefunctioning correctly, and running emergency simulations.

Equipment inspection

50

CSR Report 2015│Environment-Conscious Monozukuri

Protecting Water Resources
We recognize that water resources are an important resource, and are taking steps to reduce use of utility water andgroundwater. We routinely take active steps to save and recycle water, and also strive to manage wastewater so thatemissions do not harm the environment.

Initiatives at Domestic Facilities[Example 1] Use of Shower Testing Water (RB Controls)
The shower tests performed to assess the safety, performance, andquality of products consume large quantities of hot water. By recycling
this water and modifying our systems to permit remote-controlled
checks as well, we have succeeded in reducing the amounts of energy
and water that have to be used for these tests.
- Reduction in water consumption: approximately 1,100m3/year- Reduction in gas consumption: approximately 1,500m3/year- Reduction in CO2 emissions: approximately 9.5t-CO2/year[Example 2] Modification of Paint Processes to Protect the Environment(Yanagisawa Manufacturing)
By making its paint processes more environmentally friendly,
Yanagisawa Manufacturing has cut its water consumption and reduced
the amount of chemicals used to treat wastewater. Changes it has madeinclude:- Modification of water feed to the pretreatment process- Installation of system to circulate and filter almost all the chemicalsolution in tanks- Regular checks for leaks from pumps and in-house repair- Reduction in water consumption: approximately 1,900m3/year- Reduction in waste emissions: approximately 13t/year

Wastewater treatment facilities

Initiatives at Overseas Facilities[Example 3] Initiatives at Shanghai Rinnai Co., Ltd.
We have established a water recirculation system for hot water supply testing, using an onsite reservoir thatwas previously unused. The system is designed so that used water is stored temporarily in the reservoir (storagetank), before being passed through a chiller, filtration and ultraviolet sterilization. The water is then sent backvia a recirculation pump, to be reused as test water.

Making effective use of the reservoir

Chiller (cooling tower)

Filtration system

51

CSR Report 2015│Environment-Conscious Monozukuri[Example 4] Action at Rinnai Taiwan
Rinnai Taiwan decontaminates and recycles the water used fortesting on its assembly lines. It has also rerouted pipework.
Together these measures have resulted in an approximately
3,300m3 reduction in water consumption.

Wastewater Quality Management
To ensure that the water treated at wastewater plants causes no harm to rivers, it is constantly monitored before
discharge to ensure that its pH is kept to within even stricter limits than required by law.

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.

52

CSR Report 2015│Environment-Conscious Monozukuri

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

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

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

Verifying checklists during a visit

Status of Compliance with Laws and Regulations
There were no violations of pollution control or other environmental legislation in fiscal 2015.

53

CSR Report 2015│Measures to Improve Logistics

Measures to Improve Logistics
The Company promote its energy-use rationalization plan as a specified shipper under the revised Rationalization
in Energy Use Law. We appropriately administrate and review the energy use status concerning product logistics,
in cooperate with logistics partners. From multilateral viewpoints, we implement measures for logistic efficiency to
reduce energy use.

Measures to Reduce Shipping Amount
We consolidated our logistics bases into two in Aichi, where our main factories are located and streamlined
warehouses spread around Japan. This eliminated redundant inventory at logistic centers, the production that isneither 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 thetransportation 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
2009

Fiscal
2010

Fiscal
2011

Fiscal
2012

Fiscal
2013

Fiscal
2014

Fiscal
2015

6,519

6,483

6,333

6,687

6,587

6,836

6,763

10,013

9,901

9,837

10,23810,44010,967

10,756

Initiatives Being Pursued- Review and adjustment of product delivery routes- Effective use of round-trip shipments- Expansion of consolidated shipments within the
Rinnai Group- Increase in stacking per pallet- Encouragement of eco-driving[Example 1] Streamlining of Logistics in the Chubu Region
A survey was made of the number of delivery journeys made per day, delivery
routes (distances), loads carried (load efficiency), and other factors in order to
optimize the number of journeys made, routes used, and so on. This has madeit possible to increase the volume of deliveries made without increasing thenumber of journeys required.
- Reduction of CO2 emissions: approximately 40t-CO2/year
RB Controls, logistics center

54

CSR Report 2015│Measures to Improve Logistics[Example 2] Measures for Work Efficiency
Use of QR code
The Integral Logistics Center has introduced item-by-item control with QR
code and an inspection system. QR codes, which identify each product, areaffixed to all products and utilized in many processes in the logistic centerssuch 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 of each item. In addition, the combined
use of wireless terminals, real-time operation instruction and actual resultcollection resulted in a significant improvement of the operations.
Reduction of misshipments by improving delivery invoices
Responding to feedback from our logistics partners, in fiscal 2011 we made it
possible for the delivery names and addresses in delivery invoices to beprinted in kanji (previously they had to be printed in katakana). We also madeit possible for shipping labels to be printed in kanji. This has made them morelegible, thus making it easier for our partners to check shipments. The result
has been a fall in misdeliveries caused by misreadings.

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

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

55

CSR Report 2015│Environmental Initiatives through Sales Activities

Environmental Initiatives through Sales Activities
Developing Environmentally Conscious Products
As a comprehensive manufacturer of heat-energy appliances, the Company is aware of the corporate mission tofamiliarize environmentally conscious products with consumers, and to contribute to the reduction of CO2
emission in household energy consumption.

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

Company vehicles (Chubu Branch)

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

Safe and Eco-Friendly Drive Seminar (left) and “idling stop” display at Chugoku Sales Office56

CSR Report 2015│Environmental Education and Promotion of Awareness

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

Rinnai Group Environment Awards Programs
Seeking to invigorate employees’ environmental activities and promote access to excellent approaches within theGroup, we established “Environment Awards Programs,” effective from fiscal 2011. These awards programs
recognize activities undertaken by domestic companies under the Rinnai umbrella to protect the environment andconserve resources over a one year period. The sixth award ceremony took place as part of our “Company-wide QC
Circle Competition.” 101 activities were entered for awards in fiscal 2015, sorted into categories including
manufacturing, management, sales and social contribution. Awards were then given to the 14 best examples.

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

Rinnai Group Environmental Grand Prize Results for Fiscal 2015
Main Awards

Recipient

Aim of Activities

Manufacturing design, and production technology design
Environmental Grand PrizeOguhi Factory

Reduction of materials used to make new tabletop
cooker model (RT64JH)

Award for Outstanding
Environmental Achievement

Production Engineering Division

Production design of hybrid water heater withheating system tank unit

Environmental Award

Research & Development
Headquarters

Development of valve suitable for flat-faced cooking
stovesEnvironmental Grand Prize

Seto Factory

Improvement of cable harness specifications

Award for Outstanding
Environmental Achievement

Seto Factory“Operation 1020” to reduce latent-heat heat exchange
drying time

Environmental Award

Oguhi Factory

Improvement of productivity through energy-freekarakuri kaizen innovations

Manufacturing and logistics

Administration and sales

57

CSR Report 2015│Environmental Education and Promotion of Awareness

Environmental Grand PrizeOguhi Factory

Enhanced monitoring through energy consumption
visualization

Award for Outstanding
Environmental Achievement

Oguhi Factory

Waste reduction by reduction of cafeteria foodwastage

Environmental Award

Seto Factory

Alteration of preset temperatures achieved byupgrading air-conditioning system

Environmental Grand Prize

Rinnai Brasil Heating
Technology Ltd.

First water heater collection and recycling system to
be introduced by a Brazilian water heater
distributor/manufacturer

Award for Outstanding
Environmental Achievement

Rinnai New Zealand Ltd.

Reuse of cardboard boxes (as children’s playthings)

Environmental Award

Rinnai Brasil Heating
Technology Ltd.

Sale of hot water circulation system using liquidliquid heat exchanger

Award for Outstanding
Environmental Achievement

RB Controls Co., Ltd.

Participation in the “Cleanup Campaign in
Uchinada”

Award for Outstanding
Environmental Achievement

Marketing & Sales Headquarters

Participation in the “Iwanuma City Recovery Support
Volunteer Tree Planting Event”

Overseas facilities

Outside activities

Eco-Business Pioneer Tours
We host business networking events for learning about good environmental practice at other companies (held about
once per year).

Encouraging Eco Friendly Commuting
We designate “No Car Days” at our Technology Development Centerand encourage employees to commute in an eco friendly manner, in aneffort to reduce CO2 emissions and noise from commuting by car, and tominimize the effects of traffic jams. As well as reducing environmental
impact, steps such as commuting by public transport or bicycle insteadof by car, or car pooling with colleagues, also help to keep employees
healthy by providing moderate exercise.
- Reduction in CO2 emissions: Approx. 1t CO2/year

Bike racks
at the Technology Development Center

58

CSR Report 2015│Environmental Education and Promotion of Awareness

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

Environment Card

Employees carry their Environment
Card at all times

Cards outlining environmental costs

Encouragement of Eco-Commuting
We publish a regular in-house environmental newsletter to keep our employees around the world up to date with theGroup’s own environmental activities and environmental trends elsewhere in Japan and other countries. Publishedsince 1999 as a means of raising environmental knowledge and awareness and encouraging communication on thesubject among employees, this newsletter recently underwent a partial design and content makeover, and was
renamed Eco no Coe.

Sample pages from Eco no Coe (The new name was selected from a total of 200 suggestions put forward by employees.)*Eco no Coe literally means “the Coe of Eco,” and the name was chosen for several
reasons.
1) “Coe” signifies several things in Japanese:- 声 (koe) for the “voice” of communication- 肥え (koe) for the “fertilizing” of the environment- 超え (koe) for the “transcending” of the status quo2) The title also works as a clever anagram (and in Japanese it is actually a palindrome).
3) We want it to become an environmental newsletter that reflects everyone’s “voice.”

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.

59

CSR Report 2015│Environmental Management System

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

ISO 14001 Certification
To underpin the systematic and continuous development of environment-oriented
activities in line with our stated basic environmental policy, we encourage allmembers of the Rinnai Group to embrace efforts to acquire and maintain
ISO14001 certification.

Hokkaido Sales Office

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

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

Environmental Management Committee (left)
and a divisional liaison group60

CSR Report 2015│Environmental Management System

External and Internal Environmental Audits
The ISO 14011 Certification Division undergoes a routine audit, once a year, by an external screening/registration body toverify that the environmental management system is being properly applied. The routine audit in fiscal 2015 did not turnup any major non- conformances.

External audits

As part of internal audits, Auditing team, comprising impartial internal auditors chosen from within the Corporation who
have no direct connection to the division under audit, assess conformity to the established environmental management
system and review division activities. Auditors visit worksites of divisions tapped for an audit and perform detailed
inspections. Direct contact between auditors and divisions facilitates greater understanding of division activities and auditor
concerns. Internal audits in fiscal 2015 found no major non-conformances. There were 4 opportunities for improvement and45 observations. We swiftly addressed these areas to ensure that they would not develop into problems later on.

Internal audits

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

Environmental training for person in charge ofenvironmental issues

Environmental training for environmental internal auditor
Environmental training for trainees from overseas group companies

Biodiversity training
Environmental training for new employees

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

61

CSR Report 2015│Environmental Management System

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

Trainees attend a lecture on our environmental
initiatives

Explanation of wastewater
treatment facilities

Trainees receive explanations on our water
recycling system

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

Seminar on saving energy and spray nozzle technology

Training in Biodiversity and How It Relates to Rinnai
In addition to our own business activities, we also use large quantities ofresources and energy when our products are used and disposed of by ourcustomers. We have always emitted greenhouse gases such as CO2, too, andother substances that impact on the environment.
We published a series of special features on the theme of
biodiversity and how it relates to our own environmental activities in the inhouse environmental publication that we distribute regularly to employees.
The aim was to raise levels of awareness so that employees appreciate how
biodiversity affects them.

In-house environmental publication called“Understanding Biodiversity”

62CSR Report 2015│Environmental Management System[ISO 14001: 2004] Environmental management system certification acquisition status
Location

Rinnai

DomesticGroup
Company

Overseas
Group
Company

Certified year/month

Research and Development Headquarters

October 1997

Production Engineering Division

October 1997

Oguchi Factory

October 1997

Seto Factory

December 2000

Environment DivisionDecember 2000

Asahi Factory

November 2003

Quality Assurance Headquarters

November 2003

Head Office

December 2008

Kansai Branch

May 2010

Logistic Control Office

May 2010

Kanto Branch

May 2011

Chugoku sales office

May 2011

Rinnai Parts CenterMay 2011

Kyushu Branch

April 2012

Hokkaido sales office

April 2012

Niigata sales office

April 2012

Tohoku Branch

May 2013

Shikoku sales office

May 2013

Higashikanto sales office

April 2014

Rinnai Technica Co., Ltd.

December 2003

Yanagisawa Manufacturing Co., Ltd.

June 2004

Rinnai Precision Co., Ltd.

December 2005

Japan Ceramics Co., Ltd.

January 2006

RT Engineering Co., Ltd.

March 2006

RB Controls Co., Ltd.

March 2006

Noto Tech Co., Ltd.

January 2007

Rinnai Korea Corporation

July1997

RB Korea Ltd.

October 2006

Shanghai Rinnai Co., Ltd.

December 2008

Rinnai Brasil Heating Technology Ltd.

June 2011

Rinnai New Zealand Ltd.

July 2013

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

Techno Parts Co., Ltd.

Certified year/month
August 2011

63

CSR Report 2015│Fiscal 2015 Environmental Action Plan and Results

Fiscal 2015 Environmental Action Plan and Results(Year ended March 31, 2015)
This section outlines targets and results for key activities in fiscal 2014 - 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
Scope : Rinnai corporation

E-Products
Activity
Preventing global
warmingPreventing air
pollution

Saving and recycling
resources

Fiscal 2015 Targets

Fiscal 2015 Results

Develop high-efficiency
equipment
Reduce power consumption instandby mode・Gas water heaters

Developed high-efficiency equipment
・ Heat sources for gas water heaters withheating systems
・Gas water heaters with bath-filling systems
・Gas water heaters
Reduced power consumption in standby mode・Heat sources for gas water heaters with heating
systems
・ Gas water heaters with bath-filling systems
Developed low-NOx water heaters
・Heat sources for gas water heaters with heating
systems
・ Gas water heaters with bath-filling systems
・Gas water heaters

Continue to develop low-NOx
water heaters

Progress○○

Continue to carry out productassessments
Promote resource saving
through lightweightdevelopment

Carried out product assessments
Developed lightweight products
・Tabletop cookers
・Fan heaters
・ Heat sources for gas water heaters withheating systems
・ Gas water heaters with bath-filling systems
・ Gas water heaters
Simplified packaging○

Activity

Fiscal 2015 Targets

Fiscal 2015 Results

Progress

Green procurement

Develop green products
Implement green procurement
management

Procured and used materials in accordance with
E-Procurement Standards
Laid foundations for chemical management andreinforced cooperation with suppliers○

Fiscal 2015 Results

Progress

Reduced CO2 emissions from water heaters
when in use by customers by 51,000 tons/year△

Showcased and raised awareness of products atdomestic and overseas exhibitions
Produced and distributed catalogs, flyers andpamphlets○

E-Procurement

E-Marketing, E-Service
Activity
Increasing sales ofhigh-efficiency
products
Providing information
on environmentallyconscious products

Fiscal 2015 Targets
2

Reduce CO emissions fromhigh efficiency products by atleast 61,000 tons/year
Provide information on
environmentally conscious
products
・Showcase and raise awarenessof products at exhibitions
・Produce and distributecatalogs, flyers and pamphlets

64

CSR Report 2015│Fiscal 2015 Environmental Action Plan and Results

E-MindActivity
Disclosing
environmental
information
Environmental
education andawareness

Fiscal 2015 Targets

Fiscal 2015 Results

Progress

Publish CSR Report for fiscal
2015
Disclose environmental
information on website
Promote educational activities
in line with companywide andsite-specific plans for fiscal
2015

Published CSR Report for fiscal 2015 (October)
Disclosed environmental information on website(October)○

Provided training for internal auditors, educationon the links between biodiversity and businessactivities, etc.

○

Fiscal 2015 Targets

Fiscal 2015 Results

Progress

E-Factory
Activity
Preventing global
warming*1CO2 emission factor :Reduced by 13% compared to fiscal 2010○
Reduce by 4% or morecompared to fiscal 2010
Reducing waste
Maintain zero emissions
Maintained/improved zero emissions(Resource recycling rate of○
99.5% or higher)
Waste emission factor*2:
Reduced by at least 18.3% compared to fiscal
Reduce by 3% or more2011
compared to fiscal 2011
Water consumption factor*3:
Reduced by at least 38.9% compared to fiscal
Reduce by 3% or more2011
compared to fiscal 2011
Reducing hazardous
Hazardous chemical usage
Reduced by at least 27.6% compared to fiscal
chemical substances
factor*4:
2011○
Reduce by 3% or morecompared to fiscal 2011
*1: CO2 emission factor = Total CO2 emissions (tons/year) / net sales (¥100 million)*2: Waste emission factor = Total waste produced (tons) / net sales (¥100 million)*3: Water consumption factor = Total water consumed (m3/year) / net sales (¥100 million)*4: Hazardous chemical usage factor = Total PRTR hazardous chemicals used (tons/year) / net sales (¥100 million)
Hazardous chemicals = Class 1 Designated Substances as specified under the PRTR Act

E-Office
Activity
Green purchasing

Fiscal 2015 Targets
Maintain a green purchasingrate of 91% or higher for officesupplies and equipment

Fiscal 2015 Results
Green purchasing rate:
Achieved rate of 93.9% (monetary basis)

Progress○

65

CSR Report 2015│Fiscal 2016 Environmental Action Plan

Fiscal 2016 Environmental Action Plan
(Year ending March 31, 2016)
We will continue to push ahead with 7E activities in fiscal 2016, in an effort to improve environmental performance across all divisions andgroup companies.

Scope : Rinnai corporation

E-Products
Activity
Preventing global
warmingPreventing air
pollution
Saving and recycling
resources

Basic Action Plan

Fiscal 2016 Targets

Continue to develop industry-leading energy saving
products, focusing on activities such as developing
high-efficiency equipment using condensing
technology, rolling out hybrid water heaters withheating systems, and reducing power consumption
when equipment is in standby mode or in use
Develop low-NOx products for the domestic andoverseas markets
Develop smaller, lightweight products and components
in order to save resources, and continue to develop
products with an emphasis on resource recycling

Develop high-efficiency water heaters for the overseas
marketReduce power consumption in standby mode
・Water heaters with bath-filling system, FF heaters

Basic Action Plan

Fiscal 2016 Targets

Work with suppliers and group companies to promote
procurement of environmentally conscious products(conserving resources, saving energy, recycling, etc.)

Develop green products
・Promote use of materials compliant with E-Procurement
Standards
Implement green procurement management
・Reinforce chemical management
Look into measures aimed at ascertaining suppliers’ CO2emissions

Develop low-NOx Eco-Jozu water heaters
Conduct product assessments (all new products)
Develop lightweight products
・Tabletop cookers
・Fan heaters
・Bathroom heaters
・Water heaters with heating systems
・Hybrid water heaters with heating systems
Develop water-saving equipment
・Dishwashers
Simplify packaging

E-Procurement
Activity
Procurement

E-Marketing, E-Service
Activity
Increasing sales ofhigh-efficiency
products

Providinginformation on
environmentallyconscious products

Basic Action Plan
Increase sales of high-efficiency products in order toreduce CO2 emissions from water heaters when in use
by 465,000 tons from fiscal 2009 to fiscal 2018
*Water heaters = Hybrid water heaters with heating
systems, Eco-Jozu, etc.
Provide information on environmentally conscious
products through exhibitions, catalogs, flyers,
pamphlets, etc.

Fiscal 2016 Targets
Reduce CO2 emissions from water heaters by 60,000
tons/year

Showcase and raise awareness of products at domestic
and overseas exhibitions
Produce and distribute catalogs, flyers and pamphlets

66

CSR Report 2015│Fiscal 2016 Environmental Action Plan

E-MindActivity
Disclosing
environmental
information
Environmental
education andawareness

Basic Action Plan

Fiscal 2016 Targets

Disclose information on environmental activities andproducts via CSR Report, website, etc.

Publish CSR Report for fiscal 2016
Disclose environmental information via website

Actively organize environmental education andawareness activities for employees, and continue toraise levels of environmental awarenessPromote educational activities in line with companywide
and site-specific plans

E-Factory
Activity
Preventing global
warming

Basic Action Plan

Fiscal 2016 Targets*1

CO2 emission factor :Reduce by 6% or more compared to fiscal 2010
Reduce by 8% or more compared to fiscal 2010 byfiscal 2018
Reducing waste
Maintain zero emissions
Maintain/improve zero emissions(Resource recycling rate of 99.5% or higher)
Waste emission factor*1:
Reduce by 5% or more compared to fiscal 2011
Reduce by 7% or more compared to fiscal 2011 by
fiscal 2018
Water consumption factor*1:
Reduce by 5% or more compared to fiscal 2011
Reduce by 7% or more compared to fiscal 2011 by
fiscal 2018
Reducing hazardous
Hazardous chemical usage factor*1:
Reduce by 5% or more compared to fiscal 2011
chemicals
Reduce by 6% or more compared to fiscal 2011 bysubstances*2
fiscal 2017
*1: Emission/consumption/usage factor: Calculated on a weighted load basis (cumulative calculation), depending on the rate of achievementof factors determined for each facility*2: Hazardous chemicals = Class 1 Designated Substances as specified under the PRTR Act

E-Office
Activity
Green purchasing

Basic Action Plan
Achieve a green purchasing rate of at least 91% by
fiscal 2016
*Including newly added items

Fiscal 2016 Targets
Achieve a green purchasing rate of at least 91%,
including newly added items

67

CSR Report 2015│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, 2014 to March 31, 2015

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

3,710

Environmental
protection

Mainly efforts to save energy

7,220

Resource
recycling

Recycling as well as treatment and disposal of industrial waste

3,329

Upstream/downstream

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

679

Management activities

Mainly monitoring and surveillance of environmental impact

8,790

Research and development

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

200,732

Community efforts

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

222

In the scope ofoperations

Total

224,682

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

Environmental
impact reduction
through use of
products

Content(Unit: Ten thousand yen)
Environmental Impact
Reduction

Saving energy
reduced greenhousegases

347 t CO2/year

Reduction of NOx
with products with
low NOx emissions

82 t/year

High-efficiency
products reduced CO2

66,678 t CO2/year68

CSR Report 2015│Environmental Accounting(Unit: Ten thousand yen)
Economic Effects
Accompanying
Environmental Protection
Measures

Item
Costs cut through energy-savings and waste reduction

Economic Effect
1,338

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 achange 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.

69

CSR Report 2015┃Chronology of Environmental Activities at Rinnai

Chronology of Environmental Activities at Rinnai
March

Drafted Environmental Preservation Action Plan; established Environment Committee

DecemberWon prize at 4th Energy Conservation Vanguard 21 for gas-blast type high heat griller
RGM-4, 6, 8

1993
1994

July

Market debut: low-NOx burner built-in water heater (NOx at less than 60ppm)

1996

March

Won top prize at 1st Eco-Design Awards, sponsored by Tokyo Gas, Osaka Gas and Toho
Gas for water heater, fan heater and small hot-water heater

March

Won special prize at 2nd Eco Design Awards for tabletop cooking stove

June

Market debut: absorption-type gas air-conditioner (non-CFC)

OctoberOguchi site acquired ISO 14001 certification covering factory, Production Engineering
Division and Research & Development Headquarters

DecemberWon prize at 8th Energy Conservation Vanguard 21 for tabletop oven RSBN-096

1997

April

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

OctoberMarket debut: Yukko V Series, featuring no styrene packing, low stand-by power
consumption and low NOx emissions

1998

July

1999

2000

SeptemberMarket debut: Ecomax burner and Eco burner-equipped gas cooking stove

OctoberMarket debut: condensing water heater boasting 95% heat efficiency and NOx emissions
under 30ppm

February

Won Minister of Economy, Trade and Industry award for condensing water heater atministry's 10th Energy Conservation Awards

May

Drafted Rinnai Environmental Action Principles

AugustPublished inaugural issue of Environmental Report

January

Won Chunichi Newspaper Prize portion of Chunichi Industrial Technology Awards forcondensing water heater

June

Won Technology Grand Award from Japan Gas Association for condensing water heater

June

Won Technology Award from Japan Gas Association for condensing water heater

October

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

October

Won Logistics Prize at Japan Packaging Contest 2004 for bathroom heater/dryer

June

Won Technology Grand Award from Japan Gas Association for development of latent
heat recovery high-efficiency hot water/heating unit

2001

2003
2004

Established Environment Division

2005
September

Got involved in Team Minus 6%, a national movement to prevent global warming

2006

October

Won Electric Equipment Packaging Category Award in Good Packaging division at
Japan Packaging Contest 2006 for gas fan heater

2008

September

Gas tankless water heater sold in the United States captured 2008

70

CSR Report 2015┃Chronology of Environmental Activities at Rinnai

Super Nova Star Award (Stars of Energy Efficiency) in the United States from theAlliance to Save Energy

2009

2010

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

January

Market debut: Eco-Jozu combi boiler RUF-E Series boasting bathwater heating
efficiency rate of 92%

February

Won silver at Aichi Environment Awards, sponsored by Aichi Prefecture for global
promotion of high-efficiency combustion appliances and systems, including latent heatrecovery water heaters

April

Market debut: Eco One hybrid water heater with heating systems

January

Market debut: Eco-Jozu hot-water/heating unit RUFH-E2402 Series

AprilMarket debut: Eco One hybrid water heater with heating systems for colder regions

May

Won Technology Grand Award from Japan Gas Association for development of gas hotwater system SOLAMO to use solar heat

June

Won Aichi Invention Award sponsored by Aichi Invention Association for developmentof low-NOx burners for household gas water heaters

December

Won the Resource Recycling Manufacturing Research Group Chairman’s Award at the
IMS2011 16th Resource Recycling Manufacturing Symposium for energy saving
measures concerning enamel combustion furnaces

June

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 by Aichi Invention Association
for A-Style Gas fan heaters

October

Won Large and Heavy Good Packaging Prize of Japan Packaging Contest 2012 for Eco
One hybrid water heater with heating systems

December

Won the Resource Recycling Manufacturing Research Group Chairman’s Award at the
IMS2012 17th Resource Recycling Manufacturing Symposium for our development ofhome-use hybrid water heater with heating systems

June

Won Technology Award from Japan Gas Association for “Jikabi-No-Takumi” new gas
rice cooker, and new Delicia built-in stove
Won Aichi Invention Encouragement Award sponsored by Aichi Invention Association
for Dishwasher with baking soda wash mode

December

Won the Chairman Award of Nagoya Industries Promotion Corporation at the IMS2013
18th Resource Recycling Manufacturing Symposium for improvement of logistic
efficiency and reduction of waste disposal by reviewing of packing production process

January

Won top energy conservation award at METI Award in the fiscal 2013 Energy
Conservation Awards for Eco One hybrid water heater with heating systems

June

Won Aichi Invention Award sponsored by Aichi Invention Association for developmentof fire power adjustments for gas stoves
Won Technology Grand Award for Jikabi-No-Takumi gas rice cooker, and won
Technology Award for Speedy Kanta-Kun gas cloth dryer from Japan Gas Association

AugustWon Large and Heavy Good Packaging Prize of Japan Packaging Contest 2014 for
returnable package

2011

2012

2013

2014

71

CSR Report 2015┃Chronology of Environmental Activities at Rinnai

DecemberWon 2014 Energy Saving and New Energy Grand Prize in Kitaguni (northern area inJapan) for Eco One hybrid water heater with heating systems for Hokkaido region
Won the Chunichi Shimbun Award at the IMS2014 19th Resource Recycling
Manufacturing Symposium for our development of an eco-friendly water heater withbath-filling system

April

Market debut: Eco One third generation hybrid water heater with heating systems

June

Won Technology Award from Japan Gas Association for gas cord cover
Won Aichi Invention Award sponsored from Aichi Invention Association for twoburners for stoves in a vertical double stages

2015

72

CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

Initiatives Delivering Safety and Peace of Mind
Measures for Quality
Basic Stance on Quality
Rinnai is focused on manufacturing safe products that provide peace of mind for customers because we view gas
appliances in the same way as airplanes. If a problem occurs with either, it could lead to a major accident. Heating
appliances such as gas appliances have the capability of causing burns, carbon monoxide poisoning, a fire, explosion
and more if there is even a slight defect or problem or if they are mishandled. In the worst case scenario, an accident
may even lead to death. In the past tabletop stoves have been the cause of fires and more recently deaths caused by
the rapid change in temperature (“heat shock”) in the bath tub have become a major problem. There is no way wecan maintain sustained growth as a manufacturer unless we fulfill our basic mission as a manufacturer to deliver safe
products that provide peace of mind for customers.
In order to not have any defective products go out into the world and prevent any accidents caused by our
products, it is necessary for us to ensure our product’s safety and peace of mind from their creation, to their use andultimate disposal. That is why we are moving forward with our own unique product manufacturing that focuses onsafety and peace of mind while proactively teaching consumers how to use our products safely even after the products
are in their hands.

Basic Philosophy on Quality

Policy on Quality"Quality is our destiny"

We provide highly safe productsthat meet customers' requirements.

Pursuit of “Zero Defects”
Our basic policy for manufacturing includes “in-house product design,” “in-house development and manufacturingof critical maintenance parts” and “in-house design of production equipment.” The most significant points are the inhouse development and in-group production of core heat technologies and critical maintenance parts and the in-house
design of production equipment. During the design phase, we not only ensure the safety and peace of mind of our
products but also are able to quickly get down to the root cause of a defect or problem to fix it in the event a problem
does occur. We are also making an effort to not produce any defects (zero defects) in all phases from manufacturing(development and production), to the sale, use and after-sales service for products and their ultimate disposal.
When we say quality, that doesn’t simply mean no defects or problems. We believe we can provide more
comfortable lifestyles for our customers through heating appliances such as gas appliances and this is another facetof the quality we offer.

Voluntary Action Plan on Product Safety
In June 2007, we adopted a voluntary action plan on product safety along with a concrete strategy for putting thisplan into effect, and the relevant divisions then set about implementing it. Progress was monitored, and complianceunder the plan was completed in February 2008. The plan is currently overseen by the Quality Assurance
Headquarters, which continues to verify implementation and ensure that the entire company is working day in andday out to achieve our quality objectives.

Product Development in Pursuit of Safety and Peace of Mind
There are a variety of dangerous events that can occur with gas appliances such as gas leaks, incomplete combustion,burns, fires, etc. The mission given to development divisions is how well they can eliminate the causes of these
dangers and create a safe gas appliance. Up until now our appliances have been equipped with a number of different
safety devices. Examples would be a flame-failure device and a temperature sensor for gas tabletop stoves to prevent
fires when cooking tempura, and a CO sensor equipped to water heaters with special installation conditions.
Design divisions ensure from the design phase that safety is incorporated into the product by making surethe safety functions operate correctly in the use environment, the safety performance is maintained throughout the73CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

life of the product, and the fail-safe features to safely stop the appliance in the event it not working correctly basedon the concept of proactive prevention of unforeseen accidents so that the safety features are maintained from firstuse until the end of the products life. Design divisions also conduct various analysis using simulations and tests using
strict evaluation standards and after the results are confirmed during a meeting the structure for moving on to the next
set is established. This is the method currently being used to eliminate all defects that occur during the design phase.
We are also actively sharing product development information and training employees on safe product development
by holding quality meetings to never reproduce past defects again and holding study sessions to convey past knowhow to the next generation of employees.

Manufacturing Technology which Assures High Quality
Rinnai’s basic philosophy regarding production technology is to produce a sound product instantaneously after the
fabrication phase. We utilize an in-house completion model to manufacture quality products.
Manufacturing divisions are involved from the product planning and design phases to utilize their wealth of knowhow related to fabrication and manufacturing to ensure that development from our in-house technology andproduction equipment achieves the intended performance, the product is safe and provides peace of mind forcustomers and the product is designed to be easy to manufacture for employees. Production starts after production
processes are carefully established and reviewed with development divisions. The production equipment is designed
and manufactured within the company with the 5M in mind (Man, Machine, Material, Method and Measurement).
We work to prevent defects that are caused by inadequate equipment. The manufacturing scene is currently putting
effort into improvement activities such as QC and improvement proposals with the aim of creating a strong
manufacturing scene. We aim to create a work environment than is better each day by finding excess and waste in
manufacturing processes and solving them one by one through the continuation of steady efforts. We believe
manufacturing starts with creating great people and we place a focus on developing talented individuals who can
succeed the concepts, skills and technologies of our manufacturing process.
Meanwhile, manufacturing at overseas locations must take into account the local market in that country
or region. Japan’s level of quality is one of the highest in the world and is highly thought of abroad. For example,
when the production of gas cocks at Rinnai Indonesia started, local staff visited Japan to thoroughly learn ourphilosophy behind manufacturing. They prepared the production line with Japanese staff members and launched theirown production line in Indonesia. We will continue to build a high quality manufacturing system that is safe andprovides peace of mind for our customers both in Japan and abroad based on our philosophy that “Quality is ourdestiny.”

Making Improvements with Our Suppliers
See page 112 “Communication with Our Business Partners”

Invigorating Quality Improvement Activities
We operate a system of small-group quality control circles as a means of raising every single employee’s problemsolving skills and stimulating groups as a whole. These are being actively promoted at group companies too, and agroup-wide “QC Circle Convention” is held every September to recognize the best circles.

Company-wide QC circle conference

74

CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

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

Information about Si Sensor on Gas Built-in Hob (stovetops) Catalog

Bathroom Heater/Dryers Create “Barrier Free Temperature” Environments
According to statistics, each year around 17,000 people die while taking
a bath—more than three times the annual death toll from road accidents.
The most common causes of bathroom deaths are strokes and heart
attacks brought on by “heat shock.” With the elderly populationaccounting for a large number of such deaths, the prevention of suchbathroom incidents will become a major issue in Japan, a country withan increasingly aging population.
It is said that eliminating sudden changes in temperature
prevents “heat shock.” Bathroom heater/dryers that create a barrier-freeenvironment by warming the bathroom in advance are expected tomake a significant contribution to preventing bathroom deaths.
In light of this situation, Rinnai is promoting the proliferationof bathroom heater/dryers. Our “Bath Hotto” bathroom heater/dryer is agas hot-water-type heater/dryer that features a rapid response time.
When the heater/dryer is turned on before taking a bath, it takes 15
minutes for the bathroom temperature to reach 35 degrees. Anothernotable feature of this product is that it heats the entire body evenly fromyour head down to your toes.
We are committed to minimizing fatalities in the bathroom, and place a strong focus on raising consumer awarenessof the dangers of the bathroom and publicizing how our bathroom heater/dryers can prevent these risks. We publish
75

CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

information on safety in our catalogs, online, and via other channels to raise knowledge and awareness of how toprevent bathroom accidents.

Disclosure of Information on Safety
Notice Regarding Product Safety
The wear and deterioration of parts that occurs when products are used for a long time can lead to fires and injuries.
Incorrect use is also dangerous as it can cause breakdowns and injuries to users. To ensure safe use by our customers,
we label our products and provide information in user manuals to warn about incorrect use and how to avoid accidents
arising from careless use. Specific examples are also published on our website, where we provide clear, easy tounderstand information on how to prevent accidents.

Important Notice Regarding Product Safety

Problems that could be caused by incorrect usage

Disclosure of Information on Accidents Involving Our Products
In the event of a serious accident involving one of our
products, we immediately inform the authorities as
required by law. We also actively disclose information
directly to customers on our website in order to alert
them as soon as possible and keep them appropriately
informed in light of the severity and frequency of thetype of accident concerned.

Information on Accidents
Involving Our Products

76

CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

Inquiry Response and Support System
CS Policy
In keeping with our corporate philosophy that “Quality is our destiny,” we aim to respond sincerely, promptly, andappropriately to customer requests and queries, and to provide reliable services that deliver satisfaction and peaceof mind to the customer.

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.

Customer CenterWe established the Customer Center in an effort toimprove 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 invaluablecomments we receive are then fed back to the relevant
division, so that they can be used to identify andrectify issues, in areas such as product development,
quality control, sales and service standards.
We strive to incorporate customer comments
into our products and services on a daily basis

The Customer Center handles requests received from customers via our toll-free number, website and otherchannels. In fiscal 2015, we received approximately 880,000 calls from customers and around 4,300 comments
via our website.
In fiscal 2015, we received the following scores based on customer questionnaires.
- Ease of contacting Customer Center via toll-free number
86.2 points- Politeness of telephone operator
88.9 points- Overall score87.6 points*We have revised the evaluation categories on questionnaire cards since last year.

Customer center

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CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

Our Customers’ Comments (Customers’ comments and inquiries through our website in fiscal 2015)

The breakdown of inquiries from customers is 74% from individuals and 26% from companies.

There are the three major topics: (1) Product in use: 34.5%, (2) Product that a customer is considering purchasing:
32.5%, (3) Parts & products: 18.1%

Many inquiries were kitchen appliances-related. : (1) Kitchen appliances: 40.2%, (2) Water heater and bath-related
products: 23.9%

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CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

Enhancement of Online Support
Responding to customers who have told us thatthey want to be able to troubleshoot some issues
for themselves, we have added a Frequently Asked
Questions section to our website.

78.3% of users have expressed satisfaction with thecontent of our FAQs, and the number of visitors
accessing the FAQs page is rising constantly.
Content will continue to be frequently updated andexpanded to further assist our customers.

After-Sales Service
Our after-sales services are geared to delivering peace of mind to users and ensuring everyday comfort for all ourcustomers.

Speeding Up After-Sales Service
We have around 700 service engineers repairing products across Japan. To ensure minimum disruption to our users,
customer service requests are confirmed via mobile terminal and we aim to complete inspections the same day or the
day after a service request has been made.

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CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

Evaluating Performance Based on Service Specialist Questionnaire Cards
We ask all customers who have been on the receiving end of repair services to complete a customer questionnaire.
Covering topics such as manners during repair visits, questionnaires enable customers to rate us based on their levelof satisfaction. We then make effective use of questionnaire results by providing internal feedback on customer
comments.
The 16,000 customers who completed questionnaires in fiscal 2015 gave us an average score of over 95.2.

Supplies of Service Parts
As a rule, we keep gas appliance parts for 5 to 10 years (and in some cases for longer) after production ends. Being
able to deliver these parts promptly when needed is essential to good after-sales service and ensuring that customers
can get safe, pleasant, and long use out of their purchases.
At the Rinnai Parts Center that stores and supplies parts, the process of picking, packing, and sending out
parts is heavily systematized due to the large numbers of parts handled. It is crucial that the right types and numbersof parts be supplied on time. Improvements in quality are pursued in a range of ways, including by ensuring that work
is performed in accordance with standard operation manuals that document work and pamphlets that lay down basic
rules on quality.

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CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

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

Approach to Relations with Suppliers
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.

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CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

Voluntary system action items and the current status
Rinnai’s current status

Action items
Enhancement ofprovision of
information

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

Enhancement of
items to beinspected

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

Inspection quality
improvement

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

Warning after theinspection

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

Overview of Our Maintenance and Inspection System

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

Target product

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

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

0-6 months
in advance

Production Purchase

Registration1

Notification

Inspection
periodInspection2

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

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

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CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

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

Maintenance and Inspection System of Long-Term Use Products

The Maintenance and Inspection System ofLong-Term Use Products started in April
2009 is a system to encourage theregistration of users 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 Maintenance and Inspection System of Long-Term Use Products e

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

83CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

Recommendation of Anshin Tenken (Safety Inspection)
In consideration of the Maintenance and Inspection System of Long-Term Use Products, we recommend
Anshin Tenken (safety inspection) for products that fall outside the scope of the system.

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

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

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, withorders taken via our Product Inspection Center.
*Products subject to inspection notices: Any gas hot-water unit with a user registration card attached

Promotion of Owner 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.

Inspection Reminders Provided by Remote controls and Indicator Lamps
In November 2011, we posted information on our website about the inspection reminder function that some of our
products* come with. This function reminds users of legally designated “specified maintenance products” that theirproducts are due for inspection after the equivalent of 10 years of normal use, and users are alerted to this fact by
their remote control, a blinking indicator on the product, or similar means. This function also serves to encourage
unregistered users to register and request an inspection. This is just one example of our commitment to developing
products that deliver peace of mind to the customer.
*Specified maintenance products other than water heaters for commercial use.
- In the case of registered users
The user is sent an inspection notice through the mail shortly before an inspection is due. (Inspection notices also
contain details of how to cancel the inspection reminder function.)- In the case of unregistered users
After the equivalent of 10 years of use, the inspection function notifies the user that an inspection is due. (If the user
has applied to register as a user, he/she will be sent details of how to cancel the inspection reminder function throughthe mail.)Free Inspection of Small Open-Type Water Heaters
Inspections are used as an opportunity to enhance customer support. When our engineers visit, for example, users are
asked to fill in a questionnaire to help us constantly monitor customer opinion of our inspection services and identify
areas for improvement.

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CSR Report 2015│Initiatives Delivering Safety and Peace of Mind

Customer Trends in Response to Inspections
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.
Information on affected products and contact details for inquiries are provided on our website.

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CSR Report 2015│Communication With Our Stakeholders

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

Communication with Our Stakeholders

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CSR Report 2015│Communication With Our Stakeholders

Stakeholder Engagement: Processes and Activities

Key
Stakeholders

Customers

Employees

Shareholders/
Investors

Means of Communication

Opinions and Issues Raised and Our Responses- Customer visits- Customer Center (handlinginquiries, arranging repairs)- Exhibitions and other events- New Year parties and policy
briefings- Product seminars and training
sessions- Questionnaires- “R.STYLE” online shopping site

- We conscientiously answer a range of inquiries from
customers concerning products and parts, and post
frequently asked questions on our website.
- Customers who have had repairs done are surveyed togauge their satisfaction with elements of service such as“ease of getting through by phone” and - “politeness ofoperators.” Details of responses are then fed back tooperators so that they can remedy unsatisfactory areas.
- Respondents to a questionnaire survey of registered users
indicated that they would prefer user registration to behandled by stores. In response, in July 2012 we revised
our user registration procedure and made improvements
by, e.g., providing better explanations and making it
clearer to customers that they can request stores to do theregistration paperwork for them.
- As some people are unaware of Maintenance andInspection System of Long-Life Products, we informcustomers of this system when we have contact with them(e.g., when making repairs).

- Workplace meetings with union
representatives- Employee satisfaction surveys- Workplace presentations on
personnel system changes- Committees- Intranet and in-house newsletter- Training and related events- Individual discussions- Corporate ethics advisory service- We have established a number of programs to create amore pleasant working environment, including our ComeBack program, reduced working hours, andtelecommuting arrangements, and we will continue topursue improvements to the physical and psychologicalworking environment.
- Responding to requests from employees to be given
feedback on their personnel evaluation results, we haveintroduced arrangements for one-to-one meetings withsuperiors and encourage headquarters to provide such
feedback.
- In response to requests to extend the reemployment
period, we revised the program and increased the
maximum age for reemployment in certain areas from 65
to 68 (for some employees).
- We are committed to providing parental support andpromoting women’s employment, and are enhancing ourprograms beyond statutory requirements.

- General shareholders’ meetings- Results briefings- Investor relations meetings- Factory tours for institutional
investors- Seminars for individual investors- Questionnaires- We carefully explain our “Evolution and Succession
2017” medium-term business plan at results briefings andindividual IR meetings, and endeavor to improveunderstanding of the Group’s management policy andstrategy.
- We regularly organize facility and factory tours for
institutional investors to give them a better understandingof our strengths and competitive advantages, and tooutline our approach to manufacturing and technicalcapabilities.
- We hold results briefings and individual IR meetings toanswer inquiries and explain our underlying thinking on
dividend policy.
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CSR Report 2015│Communication With Our Stakeholders

Business
Partners- New Year meetings- We answer inquiries regarding current production levels- Policy presentations for suppliers
and provide production data for individual products and- Level-Up Workshops
details of future production plans via regular Supplier- Leadership Development Group
Liaison Group meetings.
- R-LINE*- Responding to requests from suppliers for advice on, e.g.,- R-TALK*
improving quality and productivity, we organize Level- Supplier Liaison Group
Up Workshops for major suppliers to provide them withguidance on making improvements in the workplace andhelp suppliers to make management improvements.

- Participation in- We are asked by people living near our plants and offices
grassroots/community
to assist with events and festivals aimed at enlivening
development activities
their communities, and we actively assist and take part in- Support for cultural activities and such events as a member of these communities.
the arts- We assist in cultural and artistic events in the Nakagawa
Communities/ - Employee volunteer activities
Canal area and other regions, and provide ongoing
Society- Support for extracurricular school support for exchanges and creative activities at theactivities (factory tours, etc.)
grassroots level.
- In response to requests for assistance with community
learning and school education, we organize events such as
seminars on the history of manufacturing at Rinnai andfactory tours for schoolchildren.
*R-LINE and R-TALK are our online channels for sharing information and communicating with suppliers.

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CSR Report 2015│Communication With Our Stakeholders

Selected Questionnaire Feedback
Q: What do you expect from the Rinnai Group in terms of energy?
• Energy is essential. The more you use, though, the greater is the impact on environment. I’d like
Rinnai to purse ever better efficiency and work to promote the spread of high-efficiency products.
• Energy- and resource-saving thermal energy services and equipment, reduction of the impact on thisfinite planet, development of a sustainably affluent society for future generations.
• I want Rinnai to take further action to cut CO2 emissions and play a major role as a provider of
essential services other than electricity. Humans inevitably consume heat in their everyday lives, but
resources are finite and we should try to have as little impact as possible on this planet that we live on.
• I think particular attention has to be paid to renewable energy sources too.
Q. General opinions and impressions• I would like Rinnai to take conscientious action to put safety first. Saving energy is important, but I
don’t want people to lose sight of the importance of safety either.
• Rinnai has a potentially major contribution to make given its large share of the residential sector. Is ittargeting investment in areas such as improving safety and energy efficiency? Please clearly indicate, inother words, that the company is committed to these areas.
• As Rinnai works with gas and fuels, safety should be a top priority.
• I hope Rinnai further enhances its contribution to local communities.
• I would like to see Rinnai providing assistance to developing countries as well as combating
environmental issues.

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CSR Report 2015│Communication With Our Customers

Communication With Our Customers
Surveys of Customer Satisfaction and Improvement of Products and Services
Communication with our users allows us to monitor levels of satisfaction with our products and services, areas ofdissatisfaction, and ways in which we can improve them.
As of the end of June 2015, we had received 6,000 reviews from users of our Cocotte and Cocotte Dutch
Oven grill accessories for the DELICIA built-in hob launched in August 2014. Rated for satisfaction on a five-point
scale, the Cocotte scored 4.38 and the Cocotte Dutch Oven 4.48.
In answer to the commonest request from reviewers of the Cocotte and Cocotte Dutch Oven, which wasfor more recipes, in September 2015 we launched the Bon appétit!! 100 CUISINE cookbook especially for the
DELICIA grill. In this and other ways, we are responding to customer feedback to further improve satisfaction with
our products and services.

DELICIA built-in hob

Bon appétit!! 100 CUISINE
cookbook

Taking Advantage of the Internet to Enhance Customer Support
We supply care products and user replaceable parts via our R.STYLE online shopping site to help our customers get
the most out of their purchases for as long as possible. The site started in October 2006 as online shopping site forthe genuine exchangeable parts of Rinnai products. The range of offerings is being constantly expanded in response
to direct customer feedback, and now includes cleaning and kitchen supplies that are highly compatible with our
products and original products available only through R.STYLE.
In March 2013, the number of registered members exceeded 300,000, providing even more opportunities
for contact with users of our products. To keep in touch with members’ needs, we conduct online questionnaires
and use the data obtained to design products that meet these needs and resolve issues that they raise. We willcontinue to expand direct contact with customers in our quest to deliver better service.

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CSR Report 2015│Communication With Our Customers

Using Online Customer Feedback Internally to Make Improvements
The extensive feedback provided by customers using the
R.STYLE shopping site is shared between divisions via ourinternal Sunflower Messenger site so that it can be analyzed andaddressed to enhance quality, expand service and support, anddrive other improvements. As of the end of fiscal 2015, we havereceived a total of 40,901 comments to date.

Sunflower Messenger

Targeting Marketing at Younger Consumers
In December 2011 we launched the HOWARO, a tabletop gas stove
designed especially in response to customer feedback and offered
only online as part of our marketing activities targeted at younger
consumers. Stoves of this kind normally come in somber colors suchas black and gray that do not show the dirt. In contrast, the HOWARO
comes in off-white with control knobs in an exciting range of edging
colors for greater ease of coordination with kitchen color schemes.
In the April 2015, we launched the third-generation
HOWARO, which was remodeled to further reflect customer wishes
based on feedback from an online questionnaire of over 1,200 buyers.

Providing Useful Everyday Information via Social MediaIn May 2014 we launched “Goto-kun’s Daily Recipes,” a recipe site for smartphones to help people decide what tocook. The site provides a daily selection of seasonal recipes, along with detailed instructions and lots of photos, toassist people struggling to decide what to cook on any given day.
We also launched an official R.STYLE Facebook page in June 2014. The aim is to create more points ofcontact with new customers, by providing useful everyday information in areas such as cleaning and storage, as wellas the aforementioned daily recipes.

Goto-kun’s Daily Recipe site, andRinnai Style Face Book site (right).

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CSR Report 2015│Communication With Our Employees

Communication With Our Employees
Basic Policy
We are working to develop a cheerful and satisfying work culture that motivates employees and helps them maximize
their potential, and a workplace environment that keeps employees safe and healthy.
We offer both personnel system support and various health and family-friendly fringe benefits tomotivate employees and provide them with greater job satisfaction. We also strive to create a homely atmosphereand to improve and maintain a safe and healthy workplace so that every single employee can get the most out of hisor her abilities.
We believe that motivation, job satisfaction, and space for growth hold the keys to employees’
development and maximization of their potential. To further raise employee satisfaction, therefore, we are pursuing
action in the following four areas.
(1) Provision of opportunities for personal growth (level-specific training, specialist training, practical on-thejob training, optimal placement, rotation)(2) Fair and acceptable assessment and remuneration (performance evaluation, face-to-face interview system,
improvement of salaries and allowances)(3) Development of a homely working environment (improvement of company buildings and environment,
regular events, support for club activities, inter-division collaboration)(4) Fringe benefit support including family-friendly benefits (optional fringe benefits, health support, company
pension, events arranged with employees’ union)

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-specifictraining programs, specialization courses, OJT trainings and a rotation training program, which covers workplaces
at home and abroad.

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

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CSR Report 2015│Communication With Our Employees<Major Rank-specific Training Programs in Fiscal 2016>
Training

Subject

Content

Numberoftrainees129
people84
peopleNew 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

M6 levelqualified
employees

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

New employee training program

122
people49 people

49 people

President’s speech

Career Development Review and Support
Visualizing skills of individual employees and guiding their growth (capability evaluations andfeedback of the results in one-on-one interviews)
For each training program to function effectively, it is essential to match the capability required by theorganization and the goals set by the employees.
Therefore, Rinnai prepares a "Skills Map" and a "Capability Evaluation Sheet" to define the skills
and capabilities required by each department and to clarify the goals and capabilities the company expects
the employees to achieve. Based on these tools, our employees understand their current roles andresponsibilities. 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.
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CSR Report 2015│Communication With Our Employees

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

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

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CSR Report 2015│Communication With Our Employees

From Our Employees Seconded Overseas (1)I was seconded from Research and Development Headquarters to Rinnai
America two and a half years ago. At Rinnai America, I mainly provide
support for new product development, standards and certification, andtechnical matters. Having been involved in developing products for the
U.S. market when I was at Research and Development Headquarters, theopportunity to see at firsthand how our products are received in the U.S.
has taught me a lot that is extremely useful to our development activities.
In language, culture, ways of thinking, and many other respects, there
are of course considerable differences between Japan and the U.S., andI have had my difficulties during my time here. What my experiencehas shown me, though, is just how much can be achieved by making theeffort to communicate properly by carefully understanding the otherperson and making your point firmly and clearly. The very act of trying
to understand the other person opens up new perspectives for you as
well. I feel that in order for us to continue to evolve as a global
enterprise, we need to further strengthen collaboration between ouroperations in Japan and overseas and to aim higher, working as a team.
My aim is to do my best to make my own small contribution to thisprocess.

Yoshio Goto
Rinnai America Corporation

From Our Employees Seconded Overseas (2)I have been on loan to Rinnai New Zealand from the Production Engineering
Division for around seven months now. Here I am involved in making factory
floor improvements utilizing the experience in equipment and jig design that I
gained in the departments I worked at before my secondment. I also deal daily
with inquiries from a number of departments in Japan, including Overseas
Business Headquarters, our development and environmental departments, andplants, as well as the Production Engineering Division. Many of these concern
matters that I had not previously been aware of, making every day a learning
experience. Dealing with them can often be a struggle due to a variety offactors, including differences in culture and lifestyle, different approaches towork, and difficulty getting ideas across properly due to language problems,
but my colleagues in both Japan and New Zealand are always tremendously
supportive and I am managing to get things done. So that I can do my job better
though, I want to learn more about the culture and lifestyle here and improve
my English ability in everyday life, and to strengthen mutual understanding andwork more closely with my New Zealand colleagues.

Yusuke Mizuguchi
Rinnai New Zealand

From Our Employees Seconded Overseas (3)I was assigned to the United Kingdom from the Overseas Business
Headquarters, where I was involved in product planning and providing
management support for our European subsidiaries. I am currently responsible
for management and product collaboration with Japan and also for marketing
operations.
I work with my superiors and coworkers to plan and execute sales
promotions, and it is enormously rewarding seeing these activities bear fruit.
When I have the chance, I like to travel in the U.K. and to neighboring
countries, which gives me a valuable opportunity to experience Europe’s richand varied heritages and cultures.
Looking ahead, I think we need to deepen our understanding ofmarkets and customers in not only the U.K. but the whole of Europe if we are
to expand our user base in the region. Working with all my colleagues in the
U.K., I aim to push ahead with activities to enable us to plan and market
products tailored to market needs.

Yuji Omoto
Rinnai UK Ltd.

95

CSR Report 2015│Communication With Our Employees

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

Training

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

Employee conduct display(Oguchi Factory)

Coating training station(Seto Factory)

New Engineer Training
New employees before their actual allocation to each department, receive onsite training at the Research andDevelopment Headquarters and Production Engineering Division as well as practical manufacturing training atfactories and production Group companies, and sales training at the nationwide sales offices to learn about theimportance of monozukuri including product and technology development.

Studying the structure ofdish washer

Studying the structure ofplug of gas appliances

Studying about gas combustion

96

CSR Report 2015│Communication 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 2015 >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

Fiscal2015

Fiscal
2014

81

58

68

54

2

2

0

1

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.

2

1

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

Family-care shortened
work hours

Production
divisionsManagement
divisionsApplicable tocertaindepartments

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CSR Report 2015│Communication 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 2015>
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)
Nationwide BBQ event, in Hokkaido, Tohoku, Niigata, Hokuriku,
Shizuoka, Chugoku, Shikoku, and Kyushu

Chubu Sports Festival

Number of participants
1,870
1,560
166
585

Nationwide BBQ event (Kyushu)

98

CSR Report 2015│Communication with Our Employees

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

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

Personality design seminar

Number of participants
100
38
50
107

New employee communication seminar

99

CSR Report 2015│Communication with Our Employees

Industrial 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.

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.

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.

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.

100

CSR Report 2015│Communication with Our Employees

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

Support for More Active Roles for Female Employees(1) Current status of positions held by female employees
Ideas and comments from women are absolutely crucial to our products, particularly as they use so many ofour products on a daily basis. We have female employees playing key roles and demonstrating their individual
abilities across a wide range of areas, especially in product planning and design departments, sales planningand promotion departments, fixed customer sales departments and production departments. The percentage ofwomen in generalist positions (core jobs) is also increasing every year, with the number of women in
executive positions also rising gradually. As of July 2015, the company had four female managers and 67
female employees in managerial positions (2.8% of all generalist positions).

(2) Enhancement of Support Programs for Working Women
For women to keep working for the Company after getting married, we provide various working styles andsupport programs.
<Major Programs>

Career track conversion system

Reemployment system (Come Back
Program)Childcare leave and Family care longleave
Shortened work hour system
Work from home program

A system which allows employees to convert from generalists
to clerical employees (when they do not wish to relocate for job
assignment or if there is a request for shortened working hours),
or from clerical employees to generalists (because of superior
work performance)
A program that enables former employees to return to work as afull-time employee
Programs to support employees to raise children
A program to support employees to raise children and care theirfamily members
A program to support employees to raise children, care theirfamily members and recover from diseases

101CSR Report 2015│Communication 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 166 employees working under this program. We offer oneyear contracts until the age of 65, with a choice of three options, enabling employees to work full time, alternatedays or reduced hours. We also have a system in place to extend employment to the age of 68 in the case of
employees with outstanding specialist skills or abilities, to fit in with a wide range of individual lifestyles.
This reemployment program provides employees with purpose and motivation in life as a leader/mentor
and maintains and improves the corporate culture and dynamics within the workplace.

Promotion of Recruitment of Handicapped Employees
Since fiscal 2009, we have promoted recruitment of handicapped employees in a planned manner by cooperatingwith the public employment security office and schools for the disabled. In the initial year, the employment rate ofpersons with disabilities at the Company was only 0.79%, so out of a sense of social responsibility (sense ofurgency) we took a more active stance toward recruiting handicapped people.
In July 2008, the public employment security office greatly assisted us with recruitment of handicappedpeople. The office allowed us to hold an exclusive job interview meeting at which we interviewed a total of 28
applicants and employed 15. We later began to recruit new graduates from schools for disabled students andimplemented an internship program for second-year students of those schools. The number of newly recruited
disabled employees has been increasing each year.
The Customer Center we established in fiscal 2011 has toilets and ramps for wheelchair users, andbarrier-free elevators; thereby improving the Company’s internal facilities for handicapped employees. The
employment rate of persons with disabilities at the Company has consequently been significantly improved to
1.72%. We will continue to promote recruitment activities and improve the workplace environment towardachievement of the legally mandated minimum employment rate of 2.0%.

102

CSR Report 2015│Communication with Our Employees

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

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

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

Status of On-the-Job Accidents and Injuries
In fiscal 2015, we made efforts to achieve the goal of zero accidents under the Rinnai Companywide Health and
Safety Committee, serving as the administrative organization of Group companies in Japan. We recorded a total of
26 on-the-job accidents (three fewer than in the previous year). [Divisional breakdown: 21 accidents in production
divisions, three accidents in sales and marketing divisions, two accidents in research and development divisions]
In response, under the improvement plan for fiscal 2016, we will comprehensively review what protective gearand tools to wear/use 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 safety 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.

103

CSR Report 2015│Communication with Our Employees(1) Activities to prevent fire and explosion: Enforcement of safety inspection of environmental safety equipment(gas feeders and furnaces, etc.) and test and evaluation equipment, and the improvement and renewal ofequipment as our top priority(2) Reduction of risk of earthquake damage: Preventing objects in factories and office buildings from falling over,
dropping, and scattering(3) Production site onsite guidance: Horizontal development of the production sites under the guidance of the
Safety and Health Committee of Production Group(4) Training for clerical work staff and new employees: KYT training for new employees including a monthly
information sharing session regarding on-the-job accidents, designed to promote work-safety awareness.
(5) Implementation of emergency drill: "Earthquake and fire drill" more than once a year
*KYT: Kiken Yochi (danger prediction) Training

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

Emergency drill

Promotion of Traffic Safety
To minimize traffic accidents involving employees, various measures and education programs are provided. We
obtain a certificate of driving record for each employee who is granted permission to drive a company car orcommute 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 ofrules, given that they spend more time driving than other employees. Depending on the details, we haveintroduced a safe driving “eco drive” promotion system at selected facilities, to monitor data on driving
practices on a daily basis. For new employees, as well as raising awareness of safe driving, we implement
training program such as driving, risk prediction using moving image, traffic law education, quality test, incooperation with an outside driving school.

Driver education at a driving school104

CSR Report 2015│Communication with Our Employees

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

Support for Health Promotion
Through the alliance with the Rinnai Health Insurance Society, we provide a range of medical support
services to our employees and their dependent families which include regular checkups as well as detection
examinations for various types of cancer (including prostate, intestinal and breast cancer checks). Thoroughphysical examinations are also available. For patients with lifestyle diseases, specific health guidance and an
individual follow-up are provided to make sure the employee is fully recovered.
For physical fitness, we are also eager to financially support sporting events organized by the employee
union and voluntary club activities for employees all over Japan (25 clubs including soccer, baseball, golf,
cycling, table tennis, bowling, and distance running) to promote employees’ health.

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

105

CSR Report 2015│Communication 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 2015, we organized four courses; a stress self-care seminarto help employees diagnose and deal with day-to-day stress, a basic seminarfor managers to teach them how to manage and handle members of staff, andan advanced practical seminar for managers. A total of 242 employees
attended 13 seminars in total.
We have also introduced an external mental health care service that
employees can consult regarding concerns within their local community or athome, as well as individual concerns in the workplace.
New employees

Mental health care workshop

All employees

Self care
Basic program

Basic program

Applied program

Managerial supervisor
Line care
Basic program

Applied program

Advanced program

Listener program

Internal care

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

External care

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

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

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

106

CSR Report 2015│Communication with Our Employees

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

Certified as “Parent-Friendly Company”
In fiscal 2015, we were recognized as a parent-friendly company under
Nagoya’s parent-friendly company accreditation scheme. The purpose of such
schemes is to certify or recognize companies that are working to create
parent-friendly environments. At Rinnai, we are developing a range ofprograms to facilitate work-life balance, including telecommuting
arrangements and our “Come-Back” reemployment program.

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 2013

Fiscal 2014

Fiscal 2015

(At March 31, 2013)(At March 31, 2014)(At March 31, 2015)

Male

2,517

2,534

2,536

Female

1,111

1,095

1,094

Domestic Group
Companies

Male

1,099

1,108

1,107

Female

582

567

567

Overseas Group
Companies

Male

2,361

2,969

3,032

Female

1,154

1,320

1,346

8,824

9,593

9,682

Rinnai Corporation

Total

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CSR Report 2015│Communication with Our Employees

Number of full-time employees by region (consolidated, year-end)
Fiscal 2013
Fiscal 2014

Japan

Asia excluding
Japan

North America, andEuropeOther(Oceania, SouthAmerica)

Fiscal 2015

Composition(At March 31, 2013)(At March 31, 2014)(At March 31, 2015)

Male

3,616

3,642

3,643

-

Female

1,693

1,662

1,661

-

Sub-total

5,309

5,304

5,304

54.8%

Male

1,923

2,511

2,549

-

Female

957

1,124

1,141

-

Sub-total

2,880

3,635

3,690

38.1%

Male

74

92

106

-

Female

35

41

43

-

Sub-total

109

133

149

1.5%

Male

364

366

377

-

Female

162

155

162

-

Sub-total

526

521

539

5.6%

8,824

9,593

9,682

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 usedshortened work hours
Number of employees who used the workfrom-home program
Number of on-the-job accidents
Newly recruitedemployees

Fiscal 2013

Fiscal 2014

Fiscal 2015

(At March 31, 2013)(At March 31, 2014)(At March 31, 2015)

102
61
15
13
13.7
35.3
2.0
36.2

92
49
6
13
14.0
35.8
2.3
36.8

73
39
7
6
14.2
36.0
2.4
41.6

1.71

1.74

1.72

42

58

81

57

54

68

1

1

2

36

29

26

108

CSR Report 2015│With Our Shareholders and Investors

Communication 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 65th term at the Meitetsu New Grand Hotel in Nakamura-ku,
Nagoya, on June 26, 2015. To encourage more shareholders to get involved in discussions and attend meetings,
we send out notices to convene earlier than the legally required date. We also make every effort to communicate
the company’s current situation to shareholders in a straight-forward manner, through business reports featuring
movies, images and slides for instance.

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

109

CSR Report 2015│With Our Shareholders and Investors

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

Our Policy on Dividend
One of our top management priorities is to sustain a stable
return of profits to shareholders. Several factors play into
the calculation of dividends, such as consolidated
performance, return on equity and financial status.
Seeking to enhance corporate value, management
looks at retained earnings with a view to the long term,
effectively applying this source of capital toward R&D,
capital spending and investments accompanying the
expansion of sales at home and abroad.
The annual dividend for fiscal 2015 was ¥76 pershare, up ¥8 per share from fiscal 2014.
This marked the 13rd consecutive year of higher dividends.

Share Information (As of March 31, 2015)
Number of authorized shares: 200,000,000 shares
Number of outstanding shares: 52,216,463(Including treasury stock)
Number of shareholders: 4,542

International Assessment of CSR Performance
Rinnai has been selected for inclusion in the
FTSE4Good Global Index, a worldwide socially
responsible investment (SRI) index, for elevenconsecutive years since 2004.

110

CSR Report 2015│Communication with Our Business Partners

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

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

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

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

111

CSR Report 2015│Communication with Our Business Partners

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

Policy information meetings

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

Level-Up Workshop

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

112

CSR Report 2015│Communication with Our Business Partners

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.

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

Forklift Contest
We stage a regular forklift contest for employees of our group companies and logistics partners. The aim of the contest
is to make the workplace safer and more secure by driving home the basic rules on forklift truck operation and raisinghandling skills. The fifth forklift contest was held at our Integrated Logistics Center in May 2015, and a total of 26
competitors took part: 14 from the Rinnai Group and 12 from our logistics partners.

Forklift contest

113

CSR Report 2015│Communication with Our Communities and Society

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

Support for the Restoration of the Nakagawa Canal
Headquartered in Nagoya’s Nakagawa Ward since our foundation in 1920, we are committed to contributing tosociety and giving back to the local community that has watched over us and helped to grow over our 95-year
history. Our head office is located near the Nakagawa Canal, and we are donating ¥10 million every year for 10
years (¥100 million in total) to the Nakagawa Canal Restoration and Cultural/Artistic Assistance Project (known
for short as “Nakagawa Canal ARToC10”) set up in fiscal 2012 to restore the canal and surrounding area. The aimof the program is to revive the district and make it a cultural and artistic hot spot by turning the canal into a venue
for modern contemporary art.
Now in its third year, the project has drawn steadily growing awareness among local residents and artists
and triggered interest in the Nakagawa Canal. In November 2014, a Nakagawa Canal ARToC10 art event was heldat our former parts center located near the canal. This heavily attended event featured violin performances by local
Suzuki method students and contemporary dance by the locally born dancer Nobuyoshi Asai.

View north from Nagara-bashi Bridgeon the Nakagawa Canal

Suzuki method violinists perform at ARToC10

Performance of contemporary dance by Nobuyoshi Asai

3.1-mile Walk (to Raise Funds for Alzheimer’s Patients)
Employees at Rinnai America Corporation took part inan Alzheimer’s Association walk held on October 4,
2014, to foster awareness and understanding of
Alzheimer’s disease and raise funds for support andresearch on the disease. This event is held in 600
locations annually across the United States.

Gas Ranges for the Habitat for Humanity Project
Every year since 2009, Rinnai Korea Corporation has been donating gas
ranges for families moving into homes built by Habitat for Humanity inSouth Korea. This is a project that tackles housing issues by building
homes and helping people become independent in around 80 countries
around the world. In 2014, Rinnai Korea supplied 46 gas ranges inregions including Seoul and Gunsan.

114

CSR Report 2015│Communication with Our Communities and Society

Visit to Independent Living Center
Employees from Rinnai Brazil Heating Technology Co., Ltd. visited acenter run by the Independent Living Support Association in the city ofMogi das Cruzes in São Paolo, Brazil, and presented 600 Easterchocolates to the children with disabilities who use the facility. In
addition, they visited Pro+Vida, a welfare facility for the elderly, whichis also one of their activities as a member of local community.

Walk to Raise Funds for Cancer Charity
Employees from Rinnai UK Ltd. organized a charity walk along the 7.5-mile (12-kilometer) Sandstone Trail tosupport the John Holt Cancer Support Foundation. This raised £782.80 in online donations from 33 individuals
and groups, and this was donated to the charity to support cancer patients and their families.Employees from
Rinnai America Corporation took part in the Alzheimer’s Association Walk, held to raise awareness andunderstanding of Alzheimer’s and raise funds for support and research on the disease.

Donation of Water Heaters to the Wounded Warrior Project

Rinnai America Corporation donated hybrid tank and tankless water
heaters to homeowners receiving support through the Wounded Warrior
Project, which provides homes to ailing and injured military veterans andtheir families.

Food Drive for the Real Life Center

Employees at Rinnai America Corporation collected over 15 kinds offoodstuffs to donate to the Real Life Center.

115

CSR Report 2015│Communication with Our Communities and Society

Communicating with Schoolchildren
Exhibitor at Eco ProductWe have exhibited at Eco Products since 2013. Organized by Nikkei Inc. and the Japan Environmental Management
Association for Industry, this exhibition is distinguished by the many educational school tours it attracts, as well as
business people and ordinary members of the public like other such events. Our booth at Eco Products 2014 drew
large numbers of school kids, giving them a great opportunity to learn more out about our energy-saving,environmentally friendly products and environmental activities.

Vocational Training for College Students

Rinnai (Thailand) Co., Ltd. provided vocational training in plant safety
and risk management to two college students. The purpose of thisprogram is to contribute to the development of safety risk managers, as
all production plants in Thailand are required by law to have permanent
professional safety risk managers.

Tour of Oguchi Plant by the Nakagawa Manufacturing Bus Tour
Twenty-five first- through ninth-graders visited our Oguchi Plant (the main factory where we manufacture kitchen
appliances) on the Nakagawa Manufacturing Bus Tour organized by the Nakagawa Ward authorities in Nagoya.
We also actively welcome local schoolchildren on other tours of our plants, which we seek to use as a platform forextracurricular learning about manufacturing by introducing our production facilities and explaining about our
products and how they are assembled.

116

CSR Report 2015│Communication with Our Communities and Society

Community Expedition to the Kansai Training Center
Second-graders at the Enami Elementary School in Joto-ku, Osaka, formed a “community expedition party” to visit
the nearby Kansai Training Center as part of their extracurricular activities. There they explored the product showcase
and toured other parts of the center. Some days later we received a warm message of thanks from the children.

Communication with International Students
In July 2015, two Indonesian students studying in Japan visited our head office showroom and the Nagoya Training
Center to gather material for one of a series of videos made by international students at universities in the Tokai
region and hosted by the Center for International Cultural Exchange of Technology. With video camera in hand, thestudents report on various aspects of Japan from their perspectives as international students, and the results arebroadcast to the rest of the world via social media such as Facebook. At the Nagoya Training Center, the two students
discovered what it is like to cook with our built-in hobs and sampled Japanese culinary culture.

117

CSR Report 2015│Communication 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 2015

Major financial contributions and sponsorships* Chubu High-tech Center (CHC)* Nagoya Urban Development Public Corporation (support for restoration project on the Nakagawa Canal)* Japan Virtuoso Symphony Orchestra Concert* Nagoya Philharmonic Orchestra* Nagoya School of Music, The Music Competition of Japan, Award-winning Celebration Concert* Campus Venture Grand Prix, Chubu Area
* Nagoya Shonen Shojo Hatsumei Club (Invention and Innovation Youth Club)* Jazz for Kids in Nakagawa* Haruhime Dochu (Spring Queen Parade) at Nagoya Castle Culture Forum* New York City Opera Orchestra Concert in Japan*Performance of contemporary dance by Nobuyoshi Asai in France

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.

Once a month, employees at
Yanagisawa Manufacturing Co.,
Ltd. clean up litter along thecommuting route between
Kadomashi Station and its head
office.

Japan Ceramics Co., Ltd. organizes
cleanup activities around theplant’s parking areas.

At RB Controls Co., Ltd., 76
employees took part in a “clean
beach” event to remove litter frombathing beaches in Uchinada,
Ishikawa Prefecture.

118

CSR Report 2015│Management System

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

Board of Directors
The Board of Directors has decision-making authority for important management issues affecting Rinnai andoversees the execution of duties by directors. The Board has seven members (including one outside director) andas 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 theirrespective 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 each businessyear and gain trust from shareholders, Rinnai regulates the term of director to be one year.

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

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CSR Report 2015│Management System

Structure for Monitoring Management Performance
Audit & Supervisory Board has four Board Members, two of whom are outside members. Audit & Supervisory
Board Members 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 associatedpractices with a focus on the results achieved by directors and executive bodies, and they check on the status ofoperations and asset management at the head office and principal branches. In addition, Deloitte Touche
Tohmatsu LLC undertakes accounting audits and verifies the soundness of accounting-oriented internal controls
from a third-party perspective.

Reason for Choice of Current Corporate Governance Structure
The company has one outside member on the Board of Directors and two outside members on the Audit andSupervisory Board. We consider neutral and objective monitoring of management by outside parties to be an
important element of good corporate governance, and believe that outside directors and auditors fulfill this role andensure that management monitoring by outside parties functions properly.

Development and Strengthening of Internal Controls
Internal controls are developed in accordance with our “Basic Policy on Development of Internal Control System,”
which was adopted by the Board of Directors to ensure that business is executed appropriately and efficiently. The
state of implementation is confirmed by means including risk management and internal audits, and the content of
the basic policy is revised regularly every year.
To maintain compliance with internal control reporting requirements under the Financial Instruments and ExchangeAct, the Internal Control Office (an independent division) assesses the effectiveness of development and functioningof controls to ensure the reliability of financial reports.

Director and Auditor Compensation
The maximum amounts of compensation paid to directors and auditors and other related matters are determined byresolutions of general meetings of shareholders. Our internal regulations provide for basic matters concerning
directors’ compensation, including method of determination, revisions, and reductions, and the amounts paid aredetermined in accordance with these provisions by resolution of the Board of Directors in the case of directors’compensation, and through deliberations by the auditors in the case of auditors’ compensation. At Rinnai, directors
are paid a fixed amount commensurate with their assigned duties. (We did have a retirement benefit system fordirectors, but this was terminated at the general meeting of shareholders held on June 27, 2008.)
Any directors or auditors who receive total consolidated compensation of ¥100 million or more are listed
individually in the financial statements. Note that the details of compensation paid to directors of the company infiscal 2014 are for compensation paid to the seven internal directors, and compensation in that year came to ¥376
million. (This figure does not include salaries paid to directors who serve concurrently as employees.)

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.

120

CSR Report 2015│Management System

Risk Management
Risk Management Policy
As social structures become more complex, the risks faced by companies are becoming more diverse. As the
Rinnai Group continues to expand its business globally within this environment, we are committed to risk
management in order to ensure stable business activities that sustain the trust of customers and society as a whole.

Risk Management Promotion System
A “Risk Management Committee” made up mainly of executive officers and divisional heads and chaired by thepresident meets regularly to identify key risks with the potential to impact on our survival, credibility, businessactivities, and assets. It also determines the divisions with primary responsibility for each risk, develops
mechanisms to prevent them from materializing, rapidly resolves crises, minimizes any damage that may occur asa result, and prevents recurrences. The committee works with all divisions and group companies to head off risks
and enhance risk response capabilities.

Identified Risks (Examples)










Risk of non-compliance or management in violation of applicable legislation, etc.
Risk of destruction or damage to factories, buildings or production facilities due to a disaster or accident
Risk of suspension or delays with raw material procurement activities
Risks relating to the environment
Risk of bodily injury
Risks relating to information leaks
Risk of damage to mission-critical systems
Risk relating to social media
Risks relating to infection from new strains of influenza, norovirus, etc.

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

Stable Procurement
See page 112 “Measures for Risk Management and Stable Procurement”.

121CSR Report 2015│Management System

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

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

122

CSR Report 2015│Management System

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

“Code of Ethics” booklets
of various countries“Code of Ethics” training sessions at P.T. Rinnai Indonesia (left)
and Rinnai Brasil Heating Technology Ltd. (right)

Compliance Promotion Activities
Compliance Education Activities
Within the company, the President himself takes the initiative by sending messages on corporate ethics to
employees to improve their awareness of compliance issues.
Moreover, regarding specific laws that individual departments have close relationship with, the Legal
Department takes the lead by providing legal education every year. In fiscal 2015, a total of 246 Group employees
undertook training to improve their knowledge of the law. We also provide ethical education for new recruits andfor employees in specific job classes every year, with a total of 256 employees attending sessions in fiscal 2015.
We also provide compliance-related information to employees at group companies in Japan via otherchannels, including the Group’s intranet, which we use to publish information on topics such as legal revisions
and articles explaining law that applies to our operations.

Legal education

Fiscal 2015, Actual of number of training attendants
Name of course
Number of attendants
Legal education
246 people
Ethic education by layer
256 people

123

CSR Report 2015│Management System

Confirmation and Modification of Compliance Activities
Every year, we conduct employee questionnaires to ascertain how deeply ingrained our Corporate Philosophy has
become. In fiscal 2015, breaking down the penetration rate for each component of our corporate philosophy, we
found that 99.5% of respondents were familiar with the corporate motto and 99.2% recognized our corporate
mission. We will continue to actively promote compliance activities to maintain these high levels.

Facilitation of Internal Reporting System
If, in the course of business activities, an employee at adomestic company under the Group umbrella suspects
possible breach of laws or the internal rules or unfair
practices, and it is difficult to approach a superior or the
person responsible for the division with such suspicions,the employee may report the perceived infraction to the
Corporate Ethics Helpline.
In this system, we stipulated that the person who reported
the incident will not receive any unfair treatment by thefact that he/she consulted the matter and we also pay a full
attention to the protection of privacy of the person who
made the report.
In fiscal 2015, the helpline received seven calls
for consultation and report. Appropriate measures havebeen taken, including investigation and confirmation of thefacts in these cases of alleged misconduct.

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

SolvedNot solved
Corporate Ethics Helpline

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

Protecting Personal Information
Rinnai applies internal rules based on the Act on the Protection of Personal Information. In addition, our Privacy
Policy was instituted for the handling of personal information and posted on our website. Utilizing these, we
strive to ensure appropriate storage, handling and protection of customer data.
Accordingly, we established the position of chief privacy officer and privacy officer at the head office
and require the appointment of privacy officers at all workplaces, including the offices of Group companies inJapan, to educate employees who handle personal information, and to establish physical and technical systems toinsure 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 2015.

Compliance Violations
There were no serious compliance violations in fiscal 2015.

124

CSR Report 2015┃Major Award Winning History

Major Award Winning History
Rinnai received following awards from April 2014 to September 2015.

Rinnai Corporation
Aichi Invention Award 2014 from Aichi Invention Association
June

Technology Grand Award 2014 from The Japan Gas Association
Commendation from the Commissioner of the Fire and Disaster Management Agency for
Oguchi Factory as a superior facility which handles hazardous materials

2014

AugustLarge and Heavy Good Packaging Prize of Japan Packaging Contest 2014

October

Good Design Award 2014
Best Practice Award 2014 and Special Award “Ohoshi” from the CRM Association
Japan

November

Energy Saving and New Energy Grand Prize in Kitaguni (northern area in Japan) GrandAward 2014, Development and Manufacturing section, from METI Hokkaido
The Japan Gas Association Technology Award 2015 from The Japan Gas Association

2015

June

Aichi Invention Award 2015 from Aichi Invention Association

RB Controls Co., Ltd.
2014

NovemberSuperior Company as a Work and Life Balance Award from Hakusan City, Ishikawa
Prefecture

Rinnai Korea Corporation
April
2014
DecemberBrand Survey by KMAC: Korea Brand Power Index
No.1 at gas range section
Brand Survey by KMAC: Company which a customer recommends mostNo. 1 at residential boiler section
Brand Survey by KMAC: Korea’s Most Admired Companies
No. 1 at residential boiler section

2015

February

Brand Survey by KMAC: Korea Brand Power Index
No.1 at gas range section
P.T. Rinnai Indonesia

2014

September

Platinum Award in the tabletop cooker category of the 2014 Indonesia Best Brand
Awards2015

September

Platinum Award in the tabletop cooker category of the 2015 Indonesia Best Brand
AwardsRinnai New Zealand Ltd.

2015

March

Product of the Year Award

from the Master Plumbers Society of New Zealand

Brivis Climate Systems Pty Ltd
2015

June

Australian Good Design Award at Hardware and Building category

125

CSR Report 2015│Supplemental Data 1

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

Kaechi, Oguchi-cho, Niwa-gun, Aichi
826 (as of March 31, 2015)
Manufacture of gas equipment
48,352 m2
37,093 m2
1964
October 1997

Major production items

Gas built-in hobs (stovetops)

Gas tabletop cookers

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)

420.6

60.9

5.2

Other fuels(kl)(crude oil equivalent)
30.4

Emissions into the air
CO2 emissions(t-CO2)
3,024

NOx emissions
(t)
2.6

1999

2010

2013

2014

2015(FY)

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)

46,997.0

0.0

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage(%)

46,997.0

100.0

Substances subject to the PRTR law*

Number

80
296
300
309
405

Class I designated chemical
substance nameXylene1,2,4-trimethylbenzene
TolueneNickel compounds
Boron compounds(Unit: kg)

a. Emissions
into the air

1,000.0
1,000.0
900.0
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

d. Landfill
at therelevant
office

0.0
0.0
0.0
0.0
0.0

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

29.0
0.0
170.0
56.0
230.0

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

Oguchi Factory 1

CSR Report 2015│Supplemental Data 1

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

National
0.25
180
0.10
150

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

Actual
value
0.001
83.8
0.003
64.7

■

■

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

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

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

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

Maximum
363
7.3
190
100.0
< 0.5
8.8
0.06
1.30
0.10
N.D
48.0
5.4
19.0

Actual value
Minimum
1
6.9
36
19.0
< 0.5
3.2
0.00
0.10
0.00
N.D
15
2.1
4.6

Mean
99
7.1
71.2
52.2
< 0.5
5.5
0.04
0.24
0.10
N.D
28.3
3.5
9.2

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

Environmental Initiatives
Energy saving initiatives
A system to visualize the use of energy was introduced to enhance
our level of monitoring and to reduce wasted energy.

System screen
which visualizes the use of energy

Resource saving initiatives
The plate thickness of the environmentally-friendly tabletop gas stove has been
made thinner and lighter weight. Its configuration makes automation easier andour expert use of screw tightening and other technologies has led to shorter
assembly lead times.
Amount of resources saved: Approx. 1.5 kg/unit

Tabletop cookers (RT64JT)(Approx. 18% reduction compared to our previous product)

Oguchi Factory 2

CSR Report 2015│Supplemental Data 2

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

Anada-cho, Seto-shi, Aichi
747 (as of March 31, 2015)
Manufacture of gas equipment
42,649 ㎡
27,351 ㎡
1979
December 2000

Acquisition of ISO14001 certification

Major production items

Hybrid water heater withheating system

Heating sourcefor gas water heaterGas water heaters
and others

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

LP gas
(t)

667.4

53.3

26.7

Other fuels(kl)(crude oil equivalent)
15.6

Emissions into the air
CO2 emissions(t-CO2)
3,815

NOx emissions
(t)
3.4
1999

2010

2013

2014

2015(FY)

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)2,188.7

0.0

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage(%)

2,188.7

100.0

Substances subject to the PRTR law

Class I designated chemical
substance name

Number

53
80
87
308

Ethylbenzene
XyleneChromium and chromium (III)compounds
NickelAmount of emission/discharge
a. Emissions b. Discharge c. Discharge
into the air
into public
into the soil
watersat therelevant
office(except d.)
1,100.00.0
0.0
1,400.0
1.6
0.0

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

0.0
0.0

0.0
0.0

100.0
100.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.
Air
Equipment
BoilerSubstance
Soot and dust
NOx

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

Actualvalue*2
0.002
28.7*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 2015│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

‒

‒

‒

116

10

47.6

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

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

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

7.9
3.1
4.6
4.0
< 0.5
< 0.5
0.04
0.4
0.1
N.D.
7.8
0.66

6.9
< 0.5
0.5
<1
< 0.5
< 0.5
0.01
N.D.
N.D.
N.D.
0.4
0.01

7.3
0.9
2.2
0.3
< 0.5
< 0.5
0.02
0.1
0.0
N.D.
2.6
0.12

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

Environmental Initiatives
Energy saving initiatives
We strive to thoroughly eliminate waste by daily improvement efforts in the workplace and bystrengthening energy saving.
<Promote further energy savings through better productivity>
In the water heater assembly and inspection process, we focused on the drying process with its
long cycle time. After an examination and analysis of quality, the environment, cost, etc. froma variety of perspectives, we were able to optimize the shape of the parts which reduced thedrying time (reduced the amount of energy consumed).
Reduction in CO2 emissions:

Approx. 46 tons-CO2/year<Promoted energy savings through various efforts to update air conditioning systems>
We updated our air conditioning systems to an energy efficient type and revised the temperatures our heating andcold water were set at to conserve energy. We also worked to reduce energy consumed in the workplace by
optimizing the layout.
Reduction in CO2 emissions:

Approx. 63 tons-CO2/year* Includes the benefits of updating the air conditioning system

Resource saving initiatives
We increased the color variations of connectors used in wire harnesses to prevent
incorrect connections. We also changed from dying the connectors the correct color topre-colored connectors which significantly reduced our environmental impact andstreamlined the process. We changed our materials and parts packaging to make it lesswasteful along with improvements to the entire production flow including ourdistribution network.
Reduction in discharge of waste emissions:
Communicatingwith consumptions:
local communities
Reduction in water

Ten different coloredconnectors

Approx. 21 tons /year
Approx. 19,000 litters/year

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

Explaining how water heaters work

Seto Factory 2

CSR Report 2015│Supplemental Data 3

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

Nishiyama-cho, Owariasahi-shi, Aichi
251 (as March 31, 2015)
Manufacture of gas equipment
17,772 m2
7,619 m2
1960
November 2003

Major production items

Gas fan heaters

Gas clothes
dryersBathroom
heaters/dryers

Fan-forced
gas heaters

Infrared heaters
and others

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

LP gas
(t)

139.4

17.1

2.4

Other fuels(kl)(crude oil equivalent)
4.2

Emissions into the air
CO2 emissions(t-CO2)921.4

NOx emissions
(t)
0.8

1999

2010

2013

2014

2015(FY)

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

517.7

0.0

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

517.7

100.0

Substances subject to the PRTR law*

Number

53
80
296
300

Class I designated chemical
substance name

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

600.0
1,200.0100.0
1,400.0

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

1,000.0
1,100.0240.0
4,200.0*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.

Asahi Factory 1

CSR Report 2015│Supplemental Data 3

Air
Equipment

Substance

Drying furnaces

Soot and dust
NOx

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

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

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

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

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

Maximum
64
7.5
190
81.0
1.4
4.8
N.D.
0.5
0.4
N.D.
53.0
5.9
32.0

Actual value
Minimum
15
7.0
50
19.0
< 0.5
0.7
N.D.
0.1
0.1
N.D.
33.0
3.0
10.0

Mean
39.1
7.2
88
47.4
0.8
2.3
N.D.
0.3
0.3
N.D.
43.6
4.2
19.3

■ 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 initiatives
We performed various improvements including updating our air compressor which is one of thecore equipment in our plant.
Ex.) Energy saving including improvements to the operation and control of cooling towers and dryers

Reduction in electricity consumptions: Approx. 44,000kWh /year
Reduction inCO2 emissions:

Approx. 17 tons-CO2/year

Reduction in water consumptions:

Approx. 125 m3/year

Waste initiatives
We are actively involved in improving the quality of our recycling.
- Introducing a material recycling system whereby we separate and recoverpolypropylene (PP) contained in waste plastic, and then reuse it as a raw
material- Using waste oil as a valuable resource, etc.
Separating andrecovering materials

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

Explaining how fan heaters work

Students being shown round individual production lines

Asahi Factory 2

CSR Report 2015│Supplemental Data 4

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

Yanagi-machi, Kadoma-shi, Osaka
320 (as March 31, 2015)
Manufacture of gas equipment
20,098 m2
19,314 m2
1936
June 2004

Acquisition of ISO14001 certification

Major production items

Commercial-use
high-speed ovens

Commercial-use
kitchen units

Gas rice cookers

Floor heating systems(hot-water mat)

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

LP gas
(t)

182.5

34.3

0.1

Other fuels(kl)(crude oil equivalent)
5.8

Emissions into the air
CO2 emissions(t-CO2)
1,458

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

Amount of waste
into landfill
(t)

597.7

0.0

Equipment

Substance

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

597.7

100.0

Air

BoilerDrying furnaces

Soot and dust
NOx
Soot and dust

National
0.15
150
0.15

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

Actualvalue*20.002830.0023■Units of regulation values
Soot and dust: g/m3N
NOx: ppm■Actual values for NOx and soot/dust indicate
the maximum measurements versus theregulation values for the relevant type ofequipment.

Water discharge
Substance
Amount of discharge
pH
BOD
SS
n-Hex mineral oil
n-Hex vegetable oil
Zinc
Phosphorus

National‒
5.0 - 9.0
600
600
5
30
2
32

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

Maximum
74
8.1
53.0
55.6
3.2
20.9
0.90
28.1

Actual value
Minimum
59
7.0
8.9
2.4
1.0
3.1
0.02
0.2

Mean
66
7.6
30.9
29.0
2.1
24.0
0.44
14.1

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

Yanagisawa Manufacturing Co., Ltd. 1

CSR Report 2015│Supplemental Data 4

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

Environmental patrols

Resource saving initiatives
We carry out environmental preservation activities as part of coatingprocesses at the factory. As a result, we have managed to save a considerable
amount of water and have reduced the volume of chemicals we use forwastewater treatment.
Example initiatives- Changing water supply methods for pre-coating treatment processes(Addition of automatic control devices, etc.)- Utilizing automated temperature control of chemicals in pre-coating
Waste water processing facility
treatment processes- Installing recirculation and filtration systems which almost completely filters the entire amount of chemicalliquid used in a tank
- Regularly checking for leaks from pumps, carrying out repairs in-house, etc.

Water supply

Pre-coating treatment(filtration system)

Monitoring water consumption(water meter)

Reduction in in water consumption: Approx. 19,000m3/year
Reduction in in waste discharge:

Approx. 13 tons/year

Communicating with local communities
Our employees regularly take part in cleanup activities along commuting routes and in the area surrounding thefactory. Total participants to date: 13, every month

Employee cleanup operations

Cleanup activities along commuting routes

Yanagisawa Manufacturing Co., Ltd. 2

CSR Report 2015│Supplemental Data 5

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

Sakagawa, Kakegawa-shi, Shizuoka
521 (as of March 31, 2015)
Manufacture of gas equipment
41,239 m2
10,775 m2
1970
December 2003

Acquisition of ISO14001 certification

Major production items:

Gas waterheaters

Gas instant-heating
hot-water heaters

Gas water heaters
for overseas market

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

269.9

407.6

Other fuels(kl)(crude oil equivalent)
5.4

Emissions into the air
CO2 emissions(t-CO2)2,274

NOx emissions(t)
2.2

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

948.3

0.9

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

947.4

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‒
7.6

Actual value
Minimum
‒
7.3

Mean
44.0
7.5

25 (20)20 (15)

15

0.7

5.6

‒

20 (15)

9.3

4.1

6.7

50 (40)30 (20)

6.0

< 2.0

2.4

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

Rinnai Technica Co., Ltd. 1

CSR Report 2015│Supplemental Data 5

Environmental Initiatives
Energy saving initiatives
We are actively promoting a more environmentally-conscious and safe
factory design in conjunction with establishing our new factory.
- Shortening the distance required to move items inside the factory(Reorganizing the layout of equipment and assembly line)- Shortening the operating time of the compressor- Proactively installing LED lighting- Efficiently using air conditioning

Installing LED lighting

Reduction in power consumption:

Approx. 64,000 kWh/year

Reduction in CO2 emissions:

Approx. 24 tons-CO2/year*Calculation of benefits by improving the compressor and installing LED lighting

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

Approx. 44,000 kWh/year

Reduction in CO2 emissions:

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

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

Group photo of participants

Cleanup activities

Rinnai Technica Co., Ltd. 2

CSR Report 2015│Supplemental Data 6

RB Controls Co., Ltd.

Location

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

Head office:Kannondo-machi, Kanazawa-shi, Ishikawa
Kanaiwa Factory:
Kanaiwa Higashi, Kanazawa-shi, Ishikawa
Tsurugi Factory:
Oyanagi-machi, Hakusan-shi, Ishikawa
658 (as of March 31, 2015)
Manufacture of gas equipment components
Head office:3,691 m2, Kanaiwa:3,292 m2, Tsurugi: 17,636 m2
Head office:2,892 m2, Kanaiwa:5,809 m2, Tsurugi: 10,495 m2
1971
March 2006

Kanaiwa Factory

Major production items

Electronic
control units

Head officeBathroomwaterproof TV

High voltage
units

Bathroom LED lights
And others

Tsurugi Factory

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

LP gas
(t)

555.5

2.1

289.5

Other fuels(kl)(crude oil equivalent)
21.4

Emissions into the air
CO2 emissions(t-CO2)
3,068

NOx emissions(t)
2.7

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

371.8

13.2

Amount ofintermediate
processing of waste(t)
6.1

Amount of recycled
waste
(t)

Recycling
percentage
(%)

364.7

95.1

Substances subject to the PRTR law*
Kanaiwa Factory

Number

31
186
265
448
460

Class I designated chemical
substance name

Antimony and its compounds
Methylene dichloride
Tetrahydromethylphthalicanhydride
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
0.0
0.0
0.0

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

0.0
0.0

0.0
0.0

3,200
2,200

0.0

0.0

0.0

0.0

0.0

23,000

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

2,800

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

RB Controls Co., Ltd. 1

CSR Report 2015│Supplemental Data 6

Substances subject to the PRTR law*
Tsurugi Factory

Number

186
448
460

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

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

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

0.0

0.0

2,900

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

54,000*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.

Environmental Initiatives
Environmental awareness initiatives
We created our own unique environmental characters called the Happies to promote environmental efforts in theoffice by placing it as a marker around areas where we are trying to be more efficient to spread the word. We
made panels which describe our excellent environmental efforts and each year at the cultural festival we display
them to let participants know about our efforts.
(*) Origin of the Happies: Created from a combination of the company name (“RBC”) and the image of a leaf, the Happies walk around tosymbolize the gradual journey towards a more environmentally friendly future.

Increasing greeneryin the workplace

Our own unique characters
the Happies

Notice board

Energy/Resource saving initiatives- Reuse of test water
We perform a shower test which requires a large amount of water (hot water) to assess the safety andperformance quality of equipment. We recirculate the hot water used and were able to reduce the amount ofenergy and water required by the shower test by improving the system to support remote control operation
confirmation.
Reduction in CO2 emissions:

Approx. 9.5 tons-CO2/year

Reduction in gas consumptions:

Approx. 1,500 m3/year

Reduction in water consumptions:

Approx. 1,100 m3/year

RB Controls Co., Ltd. 2

CSR Report 2015│Supplemental Data 6

Communicating with local communities
76 of our employees took part out of thetotal 500 participants in “Clean Beach
Ishikawa”, an event organized by FM
Ishikawa along the Kanaiwa coast in
Kanazawa.

Cleanup activities

Collected litter

Environmentally friendly product development (system kitchen LED lighting)
We are working to develop and spread the use of various types of LED lighting that can be used around the
kitchen.
- LED lighting that can be used under the shelf in system kitchens- Offering the same amount of luminosity as an existing fluorescentlight but at around a 60% reduction in power- Working to make the shape as thin as possible and selecting a pushswitch type that is easy to operate even with wet hands
Reduction in CO2 emissions:

Approx. 42 kg-CO2/unit

LED lighting under the shelfin a system kitchen

RB Controls Co., Ltd. 3

CSR Report 2015│Supplemental Data 7

Rinnai Precision Co., Ltd.

Commenced operations

Head office and Komaki Factory:
Shimobata, Oaza Honjo, Komaki-shi, Aichi
Kani Factory: Himegaoka, Kani-shi, Gifu
618 (as of the end of March 2015)
Manufacture of gas equipment components
Head office and Komaki Factory:20,303 m2
Kani Factory: 10,341 m2
Head office and Komaki Factory:20,202 m2
Kani Factory: 5,944 m2
1979

Acquisition of ISO14001
certification

December 2005

Location
Number of employees
Business
Land area
Total floor space

Head office and Komaki Factory

Major production items:
Kani Factory

Gas cock partsGas valve parts

Solenoid water
valve and others

Gas control units

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)

1,333.0

131.1

74.1

Other fuels(kl)(crude oil equivalent)
85.1

Emissions into the air
CO2 emissions(t-CO2)
8,337

NOx emissions(t)
6.6

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)1,740.2

2.8

Amount ofintermediate
processing of waste(t)
1.0

Amount of recycled
waste
(t)

Recycling
percentage(%)

1,736.4

99.8

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

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

Regulation value
Prefectural Voluntary‒‒‒
6.0 - 8.4
25 (20)25 (20)25 (20)25 (20)‒25 (20)Maximum
30
7.5
‒
‒
‒

Actual value
Minimum
4
6.9
‒
‒
‒

Mean
17
7.2
3.0
3.0
4.0

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

Rinnai Precision Co., Ltd. 1

CSR Report 2015│Supplemental Data 7

Kani Factory
Substance
Amount of discharge
pH
BOD
COD
SS

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

Maximum

Actual value
Minimum

Mean

25
7.0
13.0
‒
2.0

3
6.4
1.6
‒
<1.0

14
6.8
6.0
13.0
0.6

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

Environmental Initiatives
Energy saving initiatives- Cast melting furnaces make up around 30% of the energy consumed at
Rinnai Precision because of the gas consumed by the furnaces. Upon
examining and analyzing the wasted energy, we discovered it tended to run
empty because of a lack of materials.
Operational measures were implemented to prevent this waste of resourcesthat led to a reduction in energy consumed. This also led to maintenance being
performed on equipment that controlled the occurrence of oxidized materialon the furnace walls, as an example.
Reduction in gas consumption:

Approx. 40,000 m3/year

Reduction in CO2 emissions:

Approx. 93 tons-CO2/year

Cast melting furnaces- A switch was made from an existing volute pump for supplying coolant for
the washer to a multi-stage pump. This satisfied the necessary water pressure
and amount of water for the washer while reducing the amount of energy
consumed.
We were also able to save space and ensure power thanks to the multi-stage
pump.
Reduction in power consumption:

Approx. 33,000 kWh/year

Reduction in CO2 emissions:

Approx. 12 tons-CO2/year

Coolant pumpResource saving initiatives- Efforts to reuse unnecessary items
As one of our efforts to efficiently use resources, we don’t demolish unneeded
equipment and instead disassemble and selectively store reusable parts.
Furthermore, a database has been created so that anyone can use the equipment
or when creating jigs.
Communicating with local communities
As the head of the environmental committee at the Kani Industrial Park Union,
we have implemented various efforts.
- Walking around the environment at companies the association is responsible(10 companies/year)- Holding environmental committees (twice a year)- Participating in events to clean up the local area
- Holding environmental seminars, etc. (53 participating companies)[Lecture topics] “Preventive environmental management based on lessons
learnt from issues with wastewater treatment”

Inventory management

Environmental patrol

Rinnai Precision Co., Ltd. 2

CSR Report 2015│Supplemental Data 8

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

Kamiike-cho, Toyota-shi, Aichi
182 (as of March 31, 2015)
Manufacture of gas equipment andcomponents
12,199 m2
7,026 m2
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)

204.5

13.5

3.0

Other fuels(kl)(crude oil equivalent)
21.9

Emissions into the air
CO2 emissions(t-CO2)
1,136

NOx emissions(t)
1.0

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

653.6

4.2

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

649.4

99.3

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

National‒
5.0 - 9.0
600
600
5
240
32

Regulation value
Municipal Voluntary‒‒
5.7 - 8.7
5.7 - 8.0
300
150
300
150
5
2.5
150
15
20
10

Maximum
27.5
7.9
13
5
3.6
1.40
0.24

Actual value
Minimum
20
6.6
0.5
< 1.0
< 0.5
1.20
0.03

Mean
22.6
7.1
2.7
1.7
0.76
0.22
0.09

■ 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 2015│Supplemental Data 8

Environmental Initiatives
Resource saving initiatives
We moved forward with maintenance efforts using pre-coating treatment
equipment to save water and reduce the chemicals used.
- Reusing water in the final washing process (final wash) by changing thewater supply method- Adopting a wash nozzle that is able to spray less water in a wider area
- Properly managing water flow through water adjustment valves and flow
metersReduction in water consumption:
Reduction in waste emissions:

Approx. 500 ton/year
Approx. 730 kg/year

Pre-coating treatment equipment

Energy saving initiatives
We have reduced energy consumption by upgrading from existing
fluorescent lighting to LED lighting.
Reduction in power consumption:

Approx. 800 kWh/year

Reduction in CO2 emissions:

Approx. 300 kg-CO2/year

LED lighting (cafeteria)

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

Environmental training for new recruits

Communicating with local communities
Our employees carry out regular cleanup activities along commuting routes and in the area surrounding thefactory. (Number of participants: 10/year)

Cleanup activities along commuting routes and the surrounding area

RT Engineering Co., Ltd. 2

CSR Report 2015│Supplemental Data 9Japan Ceramics Co., Ltd.
Location
Number of employees
Business
Land area
Total floor space
Commenced operations
Acquisition of ISO14001 certification

Himegaoka, Kani-shi, Gifu
95 (as of March 31, 2015)
Manufacture of gas equipment components
8,030 m2
5,756 m2
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)

148.6

521.6

Other fuels(kl)(crude oil equivalent)
3.2

Emissions into the air
CO2 emissions(t-CO2)2,135

NOx emissions(t)
1.9

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

254.5

73.3

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

181.2

71.2

Substances subject to the PRTR law*

NumberClass I designated chemical
substance name

53
80
300
412

Ethylbenzene
XyleneTolueneManganese and its compounds

a. Emissions
into the air

1,800.02,600.0
12,000.0
0.0

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

d. Landfill
at therelevant
office

0.0
0.0
0.0
0.0

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

460.0
540.0
1,600.0
2,000.0*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.
Air
Equipment

Substance

Baking furnace

Soot and dust
NOx
SOx

National
0.2
400
0.49

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

Actualvalue*2
0.002
8
0.02

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

Japan Ceramics Co., Ltd. 1

CSR Report 2015│Supplemental Data 9

Water discharge
Substance
Amount of discharge
pH
BOD
COD
SS

Regulation value
WrittenNational
Voluntary
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

Mean

6.2
7.6
57
30
21.0

3.9
6.8
0.9
30
1.0

4.5
7.2
14.1
30.0
8.4

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

* When inspecting the water quality of waste water, it was discovered that the BOD value exceeded the voluntary standard
value (Kani Industrial Park Union value). With the help of the company who detected the value, we were able to specify thecause and fix the problem. After implementing the fix, the water quality analysis results show that it is now within thestandard values. Additionally, as the Kani Industrial Park reuses waste water, there is no runoff into nearby rivers.

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

Tending to a green curtain

draws in the surrounding heat.

Communicating with local communities
We participate in local cleanup activities along the Kani River. Our staff members regularly conduct cleanup
activities along commuting routes and the area surrounding the factory.
(A total of 55 staff members have participated in these activities.)

Cleanup activities along the Kani River

Cleanup activities along commuting routes

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

Installing planters

Japan Ceramics Co., Ltd. 2

CSR Report 2015│Supplemental Data 10

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

Nakanoto-machi, Kashima-gun, Ishikawa
187 (as of March 31, 2015)
Manufacture of gas equipment components
23,152 m2
13,773 m2
1990
January 2007

Major production items

Gloss enamel

Enamel components

Resin components

Rice cooker

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

243.9

950.7

Other fuels(kl)(crude oil equivalent)
48.1

Emissions into the air
CO2 emissions(t-CO2)
3,899

NOx emissions(t)
3.5

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)2,413.6414.6

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage(%)

1,999.0

82.8

Substances subject to the PRTR law*

Class I designated chemical
substance name

Number

31
71
309
405

a. Emissions
into the air

Antimony and its compounds
Ferric chloride
Nickel compounds
Boron compounds

0.0
0.0
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
8.0
0.0
410.0
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

0.0
0.0
930.0
6,220.0*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.
Air
Equipment

Substance

Baking furnace

Soot and dust
NOx

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

Actualvalue*20.001
35■ Units of regulation values
Soot and dust: g/m3N
NOx: ppm■ Actual values for NOx and soot/dust indicate themaximum measurements versus the regulation
values for the relevant type of equipment.

Noto Tech Co., Ltd. 1

CSR Report 2015│Supplemental Data 10

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)36 (27)160 (120)‒140 (100)200 (150)
120 (80)
36 (27)

Actual value
Maximum Minimum
110.0
50.0
7.2
7.0
32.0
3.0
35.0
11.0
6.0
2.0

Mean
80.0
7.2
10.0
18.7
3.2

■ 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 initiatives
A high efficiency boiler was adopted to reduce energy use in conjunction with
updating the equipment.
Reduction in CO2 emissions:

Approx. 60 tons-CO2/year(Switched the fuel from kerosene to gas)

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

Emergency drill

Communicating 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. Participants: 70

Providing an overview of the company

A tour of the manufacturing process
for gas stove components

Noto Tech Co., Ltd. 2

CSR Report 2015│Supplemental Data 11

Techno Parts Co., Ltd.
Location

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

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

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

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

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

Number of employees

401 (as of the end of March 2015)

Business

Assembly and processing of components of heat-energy appliance

Acquisition of Eco Action 21

July 2011

Major production items

Components of gas equipment and home electric appliances

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

LP gas
(t)

54.5

3.8

1.0

Other fuels(kl)(crude oil equivalent)
0.0

Emissions into the air
CO2 emissions(t-CO2)292

NOx emissions(t)
0.2

Discharge of waste
Amount of waste
generated(t)
74.0

Techno Parts Co., Ltd. 1

CSR Report 2015│Supplemental Data 11

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

A green curtain

Bitter gourds are harvested and distributed to employees- Installing motion sensors
We have installed motion sensors in lavatories and changing rooms to prevent the lights from staying on whenpeople forget to turn them off.

Motion sensor

Fluorescent light

Concern for the Water
Each office implements a variety of measures to save water.
(1) Using rainwater to water our plants and flowers, as well as in our cleanup activities(2) Taking measures to prevent the leakage of water by replacing the float valve in toilet tanks(3) Installing sensors on faucets to prevent employees from forgetting to turn off the faucet (water)

2) Replaced the toilet tank float valves
1) Rainwater tanks3) Saved water by installing sensors

Techno Parts Co., Ltd. 2