2010 Corporate Social Responsibility Report

As Homex’ business model has evolved throughout the years, as a vital component of adjusting to new market conditions, so have our Corporate Social Responsibility (CSR) practices. Thanks to this evolution, our relationships with stakeholders are more meaningful. Since our inception, Homex has been a company where ethical behavior is integrated into our business and where daily actions, both internally and externally, are centered on CSR practices.

In 2010, for the eighth consecutive year, we received the Socially Responsible Corporation award from the Alliance for the CSR in Mexico (AliaRSE) and the Mexican Philanthropy Institute (CEMEFI). This honor is evidence of our commitment to our stakeholders and an example of our evolutionary approach toward making a greater impact on every program we implement and improve.

In line with our commitment to keep you informed about the results of our CSR initiatives we have published our fourth annual sustainability report, which was developed using the standards defined by the Global Reporting Initiative (GRI) and the United Nation’s Global Compact principles, which addresses three major standards: economic, social and environmental performance. This document aims to showcase the main results from different programs and initiatives with our stakeholders- employees, clients, shareholders and government- which is aligned with the following five comprehensive measures: employee well-being, happy customers and communities, satisfied suppliers, financial health and corporate governance.

1. EMPLOYEE WELL-BEING

At Homex, we believe that employees’ well-being is the cornerstone of our company and the fuel for our success. Using this vision as a business standard, everything we do at Homex is to ensure the well-being of employees, including a long-term career plan with fair compensation based on their performance and responsibility.

To this end, we have ensured that everyone at Homex has the opportunity to create, and share responsibility for their own workplace success, thus positively impacting their personal development and family life.

In addition, our employees’ behavior is dictated by the company’s Code of Ethics, which adheres to the highest standards of corporate ethics and serves as a guideline for our workers’ internal and external behavior.

One example of our ongoing internal communications programs is “Chat with Me”, which has helped us to create an open forum for a constant communication across all levels of the organization. This program has shown us how to identify and rectify areas of opportunity in relation to employee wellbeing, resulting in a better workplace environment.

Additionally, during 2010, we created a forum where Homex’ employees had the opportunity to communicate directly with the Human Resources and Corporate Social Responsibility department. This innovative communication tool results from our evolutionary approach through which we strive to create a more transparent dialogue with our employees while improving their well-being.

Homex University:

Homex University was created in 2007 to support the development of human talent and provide ongoing training as our business processes evolve and our employees’ careers progress. During 2010, 855 training programs were offered across Homex’ branches and corporate headquarters. Some 483 scholarships were granted for postgraduate education, seminars and master degrees and 1,264 male and female employees were promoted.

Through these and other initiatives we aspire to create a better workplace, where Homex employees know they can openly and directly express their ideas and concerns.

2. HAPPY CUSTOMERS AND COMMUNITIES

In line with our objective of not only offering a home with the highest quality of standards, but also going one step beyond we maintain the sustainable growth in every community that we develop. We have created successful communities that provide our clients with the opportunity to improve their quality of life, such as access to health care, education and sport programs.

During 2010 we participated in the formation of 185 “neighbor committees” at our developments. In addition, 2,264 students completed the “Homex High School” program out of the 6,012 students who were enrolled. As a result, we launched three new community centers, bringing to a total of 12 centers that we have built in conjunction with the National Institute for Adult Education (INEA).

Additionally, we have continued to support sports programs within our Homex communities. During 2010, we organized 66 tournaments for our “Homex Fut” league, which is comprised of kids and youth teams in our developments. We also organized 54 fairs and 367 health campaigns at all of our developments nationwide, in conjunction with the Mexican Social Security Institute (IMSS), health centers and the municipal and state ministry of health.

Through our “Im joa” (my house) program, we built 800 homes in the states of Sinaloa and Michoacán. This effort was made possible by the joint collaboration of all three levels of government - federal, state and municipal - and the support of donors and the community. This program has enabled us to offer very low-income families the possibility of having a home built with their own hands, thus also contributing to the community development.

3. SATISFIED SUPPLIERS

We support our suppliers, by proactively working to meet their preference and satisfaction. In 2010, we further increased our commitment to be the best client to our suppliers.
According to this principle we have implemented several mutually beneficial alternatives with our suppliers, especially with PyMEs (small and medium enterprises) which are the engine of the country’s growth. During 2010 we maintained 3,182 active suppliers and 525 suppliers were added into our electronic invoice system. We continued working with the “productive chain” program with the National Development Bank (NAFIN) to support them by offering flexible payment structures to secure their business stability.

4. FINANCIAL HEALTH

Our primary goal is to protect and increase the investment value of Homex while maintaining its financial health; Homex’ decisions are deeply rooted in this commitment and abide by the proverb “as you sow, so shall you reap.” Accordingly, we give our employees the chance to maximize their potential; we also instill loyalty in our suppliers by building homes with the highest quality of standards while affording clients access to recreation areas, communication services, access roads, schools and health centers. The end result is a successful community where clients live happily and benefit from the increase in value of their homes.

5. CORPORATE GOVERNANCE

Our main objective on this measure is to be recognized as a solid and responsible company at the municipal, state and federal levels, and by the different institutions with whom we work.

At Homex, we embrace and follow the highest level of corporate governance standards recommended by the Mexican Securities Commission (Comisión Nacional Bancaria y de Valores, or CNBV), the Mexican Stock Exchange (BMV) and the New York Stock Exchange (NYSE).

At the same time that we follow the Best Practices Code recommended by the CNBV, we are also committed to aligning our company with the best international practices to be more competitive and transparent in our businesses practices and to ultimately generate a greater confidence among investors and stakeholders.

Homex' Board of Directors, the majority of which are independent, meets four times a year to analyze financial and operating information. They make vital recommendations in their areas of expertise, which affect the company's decision making thus protecting the interest of Homex' shareholders, suppliers, clients and workers. The Board is composed of six committees: Executive Committee, Audit Committee, Corporate Governance and Compensation Committee, Risk Committee, Disclosure Committee and Ethics Committee.

During 2010, we were recognized by the Organization for Economic Cooperation and Development (OECD) as one of the companies with the best corporate governance practices, demonstrating our commitments to responsibly follow the best practices every day.