In the year since our last report, we have seen substantial changes in the housing market and uncertainty in the global economic outlook. Yet, as I introduce this report for the 16th consecutive year, I reflect on how much remains constant. Our company continues to be built on a customer-driven operational model designed to align our business with consumer demand, preferences and affordability. Our core product offering remains steadfast: a uniquely personalized, sustainable and attainable home that has driven an enduring business. For over 65 years. we have been the place for more than 670,000 new homeowners to build their own lives and their communities of family, friends and neighbors.
We believe that this operational resilience and adaptability in the face of change is fundamental to what it means to be a truly sustainable business, and these principles are at the heart
of our environmental, social and governance (ESG) commitments and practices.
KB Home has maintained a course toward sustainability for over two decades, innovating and iterating in pursuit of industryleading goals and the continuous quest to build a better home. Sustainability has been a means for us to reduce the total cost of homeownership and expand our reach with our core first-time and first move-up homebuyers, while also striving to do the right thing for the planet and our business. We believe our sustainability initiatives and social impact are unique strengths and important to our customers, our employees, partners and stockholders.
Our goal is to get out ahead of evolving market conditions and federal and local regulations. We do this by innovating, developing and refining best practices and learning how to deliver tomorrow’s homes better, faster and more cost- effectively and sustainably than other builders.
It’s what drove our industry-leading commitment to ENERGY STAR® certified new homes 16 years ago — a platform that we have continued to build on with more than 175,000 ENERGY STAR certified new homes built to date — and it’s what drove us this past year in our major sustainability and social impact achievements.
We maintained our industry leadership position in sustainability in 2022 with outcomes that demonstrate our priorities in action:
- We launched the first residential microgrid communities of all-electric, energy-smart homes in California. Homes in these communities serve as decentralized energy resources that can act as part of a virtual power plant and create a self-reliant, energy-efficient neighborhood independently powered through solar + storage. The microgrid communities will serve as a working laboratory over the next five years to help explore and guide how the future may be powered.
- We became the first national homebuilder to commit to the U.S. Environmental Protection Agency’s (EPA) highest water-efficiency standards in drought-impacted Arizona, California and Nevada. Every KB home built in future communities in these states will be WaterSense® labeled, the EPA’s highest standard for water efficiency and performance, a strong commitment to water conservation that we are proud to make.
- We continued to contribute to meaningful social impact through an inclusive company culture that creates satisfying work for our employees while building homes for a diverse range of homeowners who reflect the face of America.
For us, offering equal opportunity is a core value and a strength in helping to create a business that can withstand challenge.
These achievements, in combination with our rigorous management practices and industry leadership in sustainability, have earned us a place on Newsweek®’s prestigious 2023 list of America’s Most Responsible Companies, The Wall Street Journal® and Drucker Institute’s Management Top 250 list and Fortune’s World’s Most Admired Companies list as well as Forbes’ 2022 list of America’s Best Midsize Employers. We continue to expand these practices and leverage a governance framework that supports a resilient, sustainable business built for the long term.
This progress across every major pillar of sustainability — environmental, social and governance — demonstrates the strength, flexibility and fortitude of our purpose-driven commitment. We may not know how economic conditions will impact housing market fundamentals in 2023 and beyond, but we do know that the future will continue to evolve and expand. Our business and many others that, like ours, are committed to doing well by doing good, will strive to address environmental and social challenges in support of a more sustainable world — one where we can afford to dream, to connect and to achieve our most meaningful goals.
We recognize that there is more work to be done and the road is not always easy. Thank you for continuing to be part of our journey.
