Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Every new home meets or exceeds ENERGY STAR standards and comes standard with a MERV-13 air filter and multispeed HVAC system, resulting in homes using, on average, half the energy of a typical U.S. home of the same size.
• Achieved EPA’s Indoor airPLUS certification.

Social Achievements

• Adopted a Human Rights Policy applying to all employees, contractors, subcontractors, vendors, suppliers, and partners.
• Donated $300,000 to charitable organizations supporting racial equity and inclusion initiatives.
• 40% of employees were female and 25% were minorities at the end of 2021.

Governance Achievements

• Established an environmental, social and sustainability committee.

Climate Goals & Targets

Environmental Challenges

• Supply chain constraints and labor shortages impacting production.
• Alleged widespread stucco application issues in some markets.
• Potential for increased costs due to stricter energy efficiency standards in new building codes.
• Risks related to climate change, such as natural disasters and extreme weather events.

Mitigation Strategies

• Leveraging long-term relationships with national and local partners to navigate supply chain limitations.
• Utilizing a spec-heavy, limited SKU operating model to manage supply chain concerns.
• Implementing energy-efficient technologies and offerings that meet and exceed current and expected energy efficiency thresholds.
• Establishing warranty reserves to cover potential costs for materials and labor not covered by subcontractors or insurance.

Supply Chain Management

Responsible Procurement

• Long-term relationships with national and local partners.
• Requiring subcontractors to comply with all laws and labor practices, adhere to the Code of Ethics, and meet performance, warranty, and insurance requirements.

Climate-Related Risks & Opportunities

Physical Risks

• Adverse weather and natural disasters

Transition Risks

• Regulatory changes, market shifts related to climate change

Opportunities

• Development of energy-efficient products

Sustainable Products & Innovation

• Energy-efficient homes with features such as MERV-13 air filters and multispeed HVAC systems

Awards & Recognition

• 2021 ENERGY STAR Partner of the Year for Sustained Excellence
• 2021 Indoor airPLUS Leader Award
• 2013-2020 ENERGY STAR Leadership in Housing
• 2020 Builder of the Year for Green Home Builder
• Various AVID Diamond, Gold and Benchmark customer service awards

Environmental Metrics

ESG Focus Areas

• Environmental Responsibility
• Diversity, Equity & Inclusion (DE&I)
• Corporate Governance

Environmental Achievements

• Received the U.S. Environmental Protection Agency’s (“EPA”) ENERGY STAR and Indoor airPLUS certifications in 2023.
• 2023 EPA's ENERGY STAR Partner of the Year for Sustained Excellence for the tenth year; 2021 - 2023 EPA's Indoor airPLUS Leader Award; 2013 - 2023 EPA's ENERGY STAR Residential New Construction Market Leader Award; USA Today’s 2023 America’s Climate Leaders; and Green Builder Media’s 2023 Eco Leaders List.

Social Achievements

• Certified as a Great Place to Work in 2023.
• Received various national and regional awards in recognition of our corporate stewardship, including: 2023 Hearthstone Builder Humanitarian Award; Arizona Housing Fund 2023 Partner of the Year Award; 2023 AZ Business Angels Award; World’s Most Admired Companies for 2023 by Fortune; America’s Most Responsible Companies for 2023 by Newsweek; U.S. News & World Report’s Best Companies to Work for in 2023; Phoenix Business Journal’s 2023 Best Places to Work; AVID Cup – Production, the highest national honor, for a second consecutive year; and Various AVID Diamond, Gold and Benchmark customer service awards across multiple categories and divisions.

Governance Achievements

• Established an audit committee, executive compensation committee, nominating/governance committee, environmental, social and sustainability committee, and land committee.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions and labor shortages impacting construction cycle times.
• Higher land costs impacting margins.
• Higher interest rates impacting affordability and buyer confidence.
• Increased competition in the housing industry.

Mitigation Strategies

• Reduced construction cycle time by over six weeks in 2023.
• Successfully executing on strategy to address demand for more affordable homes by acquiring and developing communities and designing homes that can be delivered at a lower cost.
• Offering financing incentives to address homebuyer concerns of monthly mortgage affordability.
• Continuously evaluating markets and adjusting lot supply to ensure sufficient pipeline.
• Expanding trade base and strengthening critical relationships to control costs.

Supply Chain Management

Responsible Procurement

• Code of Ethics and Vendor Code of Conduct

Climate-Related Risks & Opportunities

Physical Risks

• Adverse weather and natural disasters

Transition Risks

• Legislation and regulations relating to energy and climate change

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: TCFD

Sustainable Products & Innovation

• Energy-efficient homes with MERV-13 air filters and multispeed HVAC systems

Awards & Recognition

• 2023 EPA's ENERGY STAR Partner of the Year for Sustained Excellence
• 2021 - 2023 EPA's Indoor airPLUS Leader Award
• 2013 - 2023 EPA's ENERGY STAR Residential New Construction Market Leader Award
• USA Today’s 2023 America’s Climate Leaders
• Green Builder Media’s 2023 Eco Leaders List
• 2023 Hearthstone Builder Humanitarian Award
• Arizona Housing Fund 2023 Partner of the Year Award
• 2023 AZ Business Angels Award
• World’s Most Admired Companies for 2023 by Fortune
• America’s Most Responsible Companies for 2023 by Newsweek
• U.S. News & World Report’s Best Companies to Work for in 2023
• Phoenix Business Journal’s 2023 Best Places to Work
• AVID Cup – Production
• Various AVID Diamond, Gold and Benchmark customer service awards