KBR Corporate Headquarters601 Jefferson StreetHouston, Texas 77002713.753.2000www.kbr.com

CommitmentLetter from the CEO

Integrity7 - Who We Are7 - Sustainable Leadership8 - Ethics8 - Health and Safety9 - Environment10 - Diversity10 - Corporate Citizenship

Transparency13 - Safety Programs17 - Environmental Initiatives20 - The KBR Workforce20 - Employee Engagement20 - Employee Development and Well-Being22 - Corporate Giving and Volunteerism

Accountability27 - Certification Systems29 - Prominent Sustainability Awards

Responsibility31 - Kellogg Joint Venture Gorgon (KJVG)32 - Ichthys LNG33 - Aspire Defence (Capital Works)34 - Palm Beach Renewable Facility Unit 235 - Escravos GTL36 - Hallett Wind Farms 36 - Duke Medicine Cancer Center37 - Climate Change Adaptation Study for Five Pacific Island Nations37 - Research and Academic Center at Lake Nona38 - Kitimat LNG39 - Pacific NorthWest LNG40 - USAREUR Support Contract II40 - South Carolina 787 Facility Expansion41 - DuPont – LaPorte, Texas41 - Eastern Creek Environmental Impact Statement

Global Reporting Initiative (GRI) 3.1 Table

5

7

13

27

31

42

Table Contentsof

Dear Valued Stakeholder,

Welcome to the 2011 – 2013 KBR Sustainability Report, Built on Values.

Over the last century, KBR has evolved from its origins in pipe fabrication and road construction to become a world-class, multinational engineering, procurement and construction services company. During that time, we have delivered some of the world’s most innovative projects, from the world’s first offshore platform in the Gulf of Mexico to the world’s largest gas-to-liquids (GTL) facility, Pearl GTL, in Qatar. Despite our increasingly broad and diverse areas of business and the global arena in which we operate, what has consistently united KBR in one purpose and has helped us become the successful company we are today is what our founders M.W. Kellogg, George and Herman Brown, and Dan Root instilled in our company from the beginning — an emphasis on values.

At KBR, our values are our company culture, emphasized in our Code of Business Conduct and the ethics training in which all our employees participate annually. Rather than simply being part of our history, our values guide us daily and are an integral part of the work we perform around the world. This steadfast commitment to our values is what makes KBR a reliable partner for our customers, a trusted name in the communities we serve and a generator of value for our

stakeholders — and a primary reason why some of the world’s largest companies choose to work with us on high-dollar, complex projects. We focus on values not because external pressures demand it, but because it is the right way to conduct business and be part of the effort to build a better, more sustainable world.

KBR’s sustainability initiatives are rooted in our values. Our uncompromising commitment to quality, health, safety and the environment is one of our core company values. We implement numerous safety programs designed to keep our employees and subcontractors healthy and productive, with the goal to empower all workers to take ownership of their own safety and their colleagues’ safety — even stopping work to correct potential hazards. We volunteer with and donate funds to charitable organizations and causes that align with our mission of improving health, education and the environment. Whenever possible, we hire local workers in the multiple countries where we operate, contributing to the development of communities, new job creation and the growth of local businesses. We help clients navigate the increasingly complex regulatory landscape, reduce operating costs and enhance efficiencies through the production of environmentally-friendly solutions, technologies and best practices. We are protective of the environment and strive to minimize our impact wherever we operate. In this way, our commitment to our values creates tangible value for our clients.

Through our expansion into new territories and the exciting new opportunities in each of our business units, KBR has a bright future ahead. As we embark on our second century in business and strive to be ever more innovative, we continue to adhere to our values and our sustainability principles. Wherever we go and whatever work we perform, KBR is about building a better future by leaving a positive legacy at each project site around the world.

Sincerely,

William P. UttChairman, President and Chief Executive Officer

CommitmentOur 100-year legacy of building a better future 5

4101

Rank in CareerBliss’ Top50 Happiest Companies in

America (2013)

37Rank in Engineering

News-Record’s Top 100 Green Contractors (2013)

Rank in Newsweek’s Top 500 Greenest Companies

(2012)

Square feet of LEED-certified leased office space

1,000,000

Combined KBR and employee charitable giving

$10,167,660

KBR’s spend withdiverse suppliers

$100,820,833

Employee volunteer hours70,000

Amount KBR CharityGolf Tournament has

raised to date

$2,098,250

73%Fewer safety incidents

at KBR since 2007

1,000Tons of carbon emissions

reduced at KBR’s U.K. offices

KBR Values- Uncompromising commitment to quality, health, safety and environment- An open relationship with our employees based on mutual trust, respect and success- Transparency, accountability and discipline in our business- Best-in-class risk awareness- Integrity in all we do- Financial responsibility to our stakeholders

Who We AreAs a global engineering, procurement and construction services leader, KBR has many opportunities to positively impact the world, from the way we choose to conduct business, to how we hire, train and develop our employees, preserve the environment and protect the health and safety of our people. KBR’s business practices and philanthropic activities call for an enduring, integrated approach to balancing sustainability with the need to meet client requirements and corporate objectives. To be a responsible corporate citizen, we always lead by example.

At KBR, our values and our integrity are at the heart of who we are, what we believe and how we conduct our business.

Sustainable LeadershipTo ensure that our sustainability initiatives meet the needs of our stakeholders, KBR created a global Sustainable Development (SD) Committee, with members selected from diverse departments and office locations to achieve a broad

IntegrityThe guiding force behind all our activities 7

Delivering Expertise- Engineering- Procurement- Construction- Design/build- Proprietary process technologies- Program and project management- Operations and maintenance- Logistics management and support

Our integrity is at the heart of who we are, what we believe and how we conduct our business worldwide.

Opposite: National Tree Day, Ithaca Creek, Australia / Above Left: KBR engineers work on a project / Above Center: Team KBR at WalkMS / Above Right: KBR employee at LNG facility

Putting Safety First — 17 Years without a Lost-Time IncidentKBR consistently demonstrates that, when everyone on the team is committed to safety, we create an incident- and injury-free workplace. Our employees at the Boise Cascade Pulp and Paper project in Jackson, Alabama, recently celebrated a major accomplishment. For nearly two decades — the entire time KBR has operated at this job site — this crew of 60 year-round workers has successfully performed small-capital projects and maintenance services without a single lost-time incident.

Site managers adopt several practices focused on maximizing employee involvement in the safety process and empowering them to report safety violations and recommend improvements — all in alignment with KBR’s robust global safety culture. From completing a safety instruction card each time an employee switches tasks, demonstrating that he or she received training and understands how to safely work, to participating in team safety meetings, employees play an important role in implementing safety initiatives.

To ensure that clients’ projects are completed with an emphasis on safety excellence, quality and long-term value, KBR has adopted a Health, Safety and Environment (HSE)policy within our COBC. We complete all projects according to current local, state and federal regulations, as well as indus-try standards, including the American Society of Mechanical Engineers, American Petroleum Institute, National Fire Prevention Association and ISO 9000. These requirements are complemented by the KBR Integrated Management System (IMS), our corporate library of standards, specifications, lessons learned and best practices.

The following processes are part of the KBR IMS, and are conducted throughout each project:

• Process hazard review• Safety and integrity reviews• Design and design risk reviews• Technical oversight meetings • Safety checklists• Risk mitigation• Emergency prevention and response

Another important component of our safety culture is company-wide awareness programs that help KBR maintain a healthy workforce, while minimizing costly delays, increasing productivity and ensuring high-quality results for clients. KBR encourages personal responsibility and empowers employees with the knowledge, skills and training necessary to make safety decisions — even giving employees the authority to stop work if a potential hazard is detected, until the problem is corrected. Our employees recognize hazards and take proactive steps to resolve them before an incident occurs. As a result, KBR consistently maintains an outstanding safety record, and many of our projects around the world have been recognized by clients and industry organizations for achieving significant safety milestones.

Each year, KBR conducts an annual management review with our CEO to examine our HSE policies, goals and achievements,

as well as employee-improved behaviors. We also evaluate the effectiveness of our IMS.

KBR actively participates and provides leadership within organizations that produce safety methodologies, including: American Institute of Chemical Engineers, Occupational Safety and Health Administration, American Society of Safety Engineers, National Safety Council, British Safety Council, Safety Institute of Australia, Association of General Contractors of America, Houston Business Roundtable, Board of Certified Safety Professionals, Canadian Operators Association and Canadian Society of Safety Engineers.

KBR is committed to the general well-being of all our employees. We understand that it is often challenging to maintain wellness while working extensively on complex projects, coupled with external stressors — and we strive to show employees that KBR values them and their many contributions to the company. That’s why KBR offers our employees specific services and programs intended to promote healthy lifestyles.

EnvironmentKBR is dedicated to a future that achieves the preservation of our natural resources and economic prosperity around the world. To that end, our environmental pledge is to reduce the impact of our services and operations, and to consistently work with our global partners, clients, contractors and suppliers to improve energy efficiency, conserve resources and reduce waste and air emissions.

One of the ways that KBR delivers value to the global marketplace is by creating sustainable solutions. We aim to develop products and services that have no undue environmental impact, are safe in their intended use, are efficient in their consumption of energy and natural resources, and can be recycled, reused or disposed of safely — in accordance with applicable laws and industry standards.

representation of the company. The SD Committee provides a centralized and comprehensive global perspective regarding the diverse views of sustainability in the regions of the world where we operate, and the issues that are important to our clients and the communities we serve. It also supports all of our corporate responsibility programs by recommending and overseeing an overall framework for sustainable development that works alongside our company’s strategy and goals.

To enable communication and collaboration between our sustainability initiatives and business operations, the SD Committee is led by a Steering Committee, comprised of representatives from each KBR business unit, and the Vice President of Quality, Health, Safety and Environment (QHSE). Designated by the CEO, the Vice President of QHSE is also KBR’s Chief Corporate Social Responsibility Officer.

The Corporate Social Responsibility Committee, comprised of members of the KBR Board of Directors, governs all sustainability matters.

Ethics The KBR Code of Business Conduct (COBC) is a collection of 17 corporate policies that guide the behavior we expect of employees every day at our workplace. The COBC applies to every employee and those we hire to perform work on our behalf, from upper management to all full-time employees, and from craft/hourly employees to subcontractors.

At KBR, the COBC is not just a document— it is an active part of our daily work. It showcases our values that are so much a part of our company’s culture. It is how we present ourselves to the world and build our strong reputation for professionalism and fair, ethical behavior toward all. Put simply, it’s how our global team does business.

Each employee is required to become familiar with the COBC upon hire. To demonstrate our commitment to maintaining an outstanding workforce, KBR employees are required to refresh their ethics training with an annual course.

As an extension of our COBC, KBR adopted a Global Human Rights Policy that acknowledges the principles contained in the United Nations Declarations of Human Rights. While KBR believes it is the role of government in each country to protect the human rights of its citizens, we play an important role in upholding equality, dignity and respect for all people by our actions in the countries where we conduct business. Our human rights policy serves as a powerful guide for our

employees and subcontractors. For example, KBR has a zero-tolerance policy regarding Trafficking in Persons compliance. We enforce these requirements by conducting pre-award reviews, mandating that all employees and subcontractors deployed overseas attend a Trafficking in Persons training program, performing monthly inspections at subcontractor temporary labor camps, and offering an ethics hotline for employees to report any concerns, including potential Trafficking in Persons violations.

Since KBR became an independent company, we have strengthened our compliance with the Foreign Corrupt Practices Act (FCPA) and other anti-corruption laws. Under the oversight of our Board of Directors, CEO and other company officers, KBR has implemented a monitor-certified anti-corruption program, which includes a whistleblower program; policies regarding improper payments, commercial bribery and international business relationships; and processes and policies covering international commercial intermediaries, international services intermediaries, partners and business transactions with foreign officials.

KBR offers an independently operated, global ethics hotline for reporting possible violations of the KBR COBC or applicable anti-corruption laws. These allegations are investigated to resolve any issues, and KBR takes disciplinary action as needed. Upper management reviews all alleged violations of the COBC. Between 2011 and 2013, the KBR Ethics Hotline received 1,294 calls, of which 330 concerned potential COBC violations.

Health and SafetyMuch of KBR’s work is technically complex, occurs in some of the world’s most challenging environments and potentially involves hazardous materials. The safety of our employees, subcontractors, clients and those impacted by our activities is KBR’s top priority and one of our core values. Safety is a fundamental behavior that guides how KBR approaches every project — regardless of size, complexity or location. Our global success and the success of our customers depend on a robust safety culture and the rigorous standards we integrate into everything we do.

8 9Supporting Diverse Markets and Industries- Energy - Hydrocarbons- Mining and minerals- Power, including alternative and renewable energy sources- Industrial services and infrastructure- Commercial infrastructure- Civil infrastructure - Government and defense

KBR employees at the Boise Cascade Pulp and Paper project

Above: EBIC Ammonia Plant, Egypt

We recognize diverse views on climate change, and we successfully perform work within countries around the world according to varying laws. The global conversation about climate change and increasing regulation is generating interest among our customers and stakeholders, and KBR is responding through our service offerings. Our activities range from undertaking studies and producing strategies related to climate change adaptation, to helping customers comply with anticipated requirements, developing strategies to market existing licensed technologies in new ways and evaluating alternative technologies. In anticipation of increasing demand for cleaner energy, KBR also has developed our own licensed, energy-efficient technologies to support a range of industries and processes. Globally, KBR consistently evaluates methods to reduce our operational carbon footprint and implements those options when economically feasible.

KBR has been honored worldwide for our commitment to the environment and sustainable operations through major industry awards and high ratings within prestigious certification systems that recognize environmentally friendly and energy-efficient construction, including LEED (Leadership in Energy & Environmental Design), BREEAM (BRE Environmental Assessment Method) and NABERS (National Australian Built Environment Rating System).

DiversityWith more than 27,000 employees in 70 countries across six continents, KBR is truly a global company. But being a global company means more than having a large staff and project sites located around the world — it also means actively recruiting and retaining the best talent from a multinational pool.

KBR’s goal is to have our workforce reflect the diverse communities that we serve around the world. We recognize that valuable lessons come from beyond the workplace, and we strive to bring different viewpoints together to learn from

this varied knowledge. We believe strength comes from team members of many different cultures, races and backgrounds contributing their experience toward a common goal: delivering any project, any time, in any environment to customers worldwide.

KBR’s commitment to diversity includes partnerships with local communities around the world. KBR strives to hire local and indigenous workers from the regions where projects are located. In doing so, our goal is to create jobs, many of which are affiliated with projects of international importance; expand workers’ skills, knowledge and experience to develop their careers; support local businesses, suppliers and contractors, including minority- and women-owned enterprises; and provide more opportunities for communities. KBR’s work results in the delivery of a better future for our local partners.

Corporate CitizenshipKBR is more than a global company — we are a citizen and neighbor in hundreds of communities around the world. Our ability to positively impact local communities and populations isn’t limited to job creation or worker development — KBR provides direct assistance and social benefits to those in need. With a focus on improving health, education and the environ-ment, KBR is part of the drive to build a better world.

Above Left: KBR volunteers clean a marsh / Above, Top Right: KBR riders in the MS 150 / Above, Bottom Right: KBR volunteers build a home for Habitat for Humanity

In alignment with these three charitable focus areas, both KBR and our employees take action to ensure the communities where we live and work are vibrant and successful. Through our corporate giving program, KBR donates funds to assist many nonprofit organizations in fulfilling their missions.

Employee volunteerism is at the heart of our corporate philanthropy and our connection to the communities where we operate. Every day, KBR employees generously donate their time and funds to reach out to those in need through numerous corporate charitable initiatives, volunteer organizations and community outreach programs — including planning, staffing and participating in hundreds of events annually.

HealthAs with our employees, KBR wants as many people as possible to enjoy a healthy lifestyle, access to high-quality care and a positive state of well-being. To that end, we support health initiatives that are of concern to our employees and integral to where we work around the world. KBR donates funds and supplies to victims of natural disasters, and supports organizations dedicated to patient services and medical research for diverse causes that include cancer, mental health, multiple sclerosis, and prenatal and infant health.

We are also a contributor of funds to the Texas Children’s Hospital Global Health Initiatives program.

EducationKBR is dedicated to developing the next generation of innovators and leaders, particularly in the areas of science, technology, engineering and mathematics (STEM). We encourage more individuals, including students, women and minority groups, to choose STEM careers. With engineering among the fastest-growing occupations around the world, it is KBR’s goal to strengthen and diversify the pipeline of talent, especially at the primary education level, choosing STEM careers.

EnvironmentTo create a sustainable and secure future, KBR strives to reduce the impact of our operations by improving energy efficiencies, conserving natural resources and minimizing waste and air emissions. We take this commitment a step further by providing financial assistance and volunteers for organizations that work toward the conservation of land and wildlife around the world and the restoration of public spaces and waterways, including the reduction of pollution and litter. We also support causes that educate the public about the importance of environmental stewardship and how to protect our planet.

10 11

KBR and the Nature Conservancy: A Global MissionWith the Nature Conservancy as our partner, KBR is playing a notable role in protecting a culturally and ecologically significant stretch of land in Northern Australia.

Located in central and western Arnhem Land in Australia, the Warddeken and Djelk Indigenous Protected Areas were established to protect culture and nature across 5 million acres. KBR is helping the Nature Conservancy support these indigenous people in their efforts to live on and manage their lands for conservation. Indigenous rangers are leading this initiative, combining science with traditional knowledge to perform activities such as fire management, feral animal control and invasive plant removal.

At KBR, we believe that our expertise, particularly in areas such as hydrology, can work alongside centuries-old knowledge to result in far-reaching conservation benefits.

For more stories about how KBR is positively impacting communities around the world, visit www.kbr.com/Social-Responsibility/Community

Above Left: Indigenous Warddeken and Djelk people / Above Right: Protected lands in Northern Australia

Reflective of our commitment to a diverse workforce, KBR is a Level 5 Contributor and Value-Adding Supplier of the Broad-Based Black Economic Empowerment (BBBEE), a South African government initiative to enhance the participation of its black citizens in the national economy.

Honesty and openness with all of our stakeholders are among our core values. KBR believes that we can only experience effective operations where mutual trust exists. As we work toward an even safer, healthier, cleaner and more diverse future, KBR is pleased to share the programs that drive — and the data that backs up — our sustainability initiatives.

Safety ProgramsAs a result of the implementation of safety programs designed to raise awareness about potential hazards on the project site and in the office and how to avoid or correct them, total recordable safety incidents at KBR have declined by 73 percent since our first year as an independent company. Between 2011 and 2013, KBR attained 448 days without any recordable safety incident throughout all business groups. With each passing year, KBR strives to achieve an incident- and injury-free workplace — and our many safety programs are critical to this progress.

Health and Safety Management SystemThe OHSAS 18001 Health and Safety Management System, in which KBR is certified, reinforces the health and safety protocols that we use in our business operations through

adherence to strict global standards of risk management, emergency response planning and incident prevention. For more information about the certification programs in which KBR participates, please refer to page 27.

S.A.F.E. KBR developed the S.A.F.E. (Shaping Accident-Free Environments) program to reinforce our goal of achieving incident- and injury-free work. This program emphasizes the need for individuals to take ownership of their own safety and their colleagues’ safety, and provides employees with the necessary tools to empower them to make safety decisions — even stopping work when a potential hazard is identified, until the problem is corrected. KBR believes that a workplace culture that values self-responsibility fosters other important performance indicators, including high employee satisfaction, quality and profitability. It also instills attitudes and practices that encourages employees’ off-the-job environment to be as safe and healthful as the one at work. The S.A.F.E. program, with its goal of having each employee return home daily as healthy, functional and productive as they came to work, embodies our health and safety values as established in our Code of Business Conduct (COBC).

TransparencyProudly sharing our forward progress 13

Americas

Middle East

Europe

Australia

AsiaAfrica

51.8%

28.2%

7%

4.6%7%

1.4%

Recordable Incidents

Lost-Time Incidents

0

.10

.20

.40

.30

.50

.60

2013201220112010200920082007

.53(1045)

.47(1065)

.49(1048)

.20(389)

.19(424)

.19(398)

.39(629)

.12(201)

.37(468)

.10(128)

.38(279)

.06(47)

.35(284)

.09(73)

When transparency and mutual trust exist, our performance excels.

Safety Incidents, 2007 – 2013 Safety Incidents by Country/Region, 2011 – 20132011 2012 2013

Americas

Middle East

Europe

Australia

AsiaAfrica

44.7%

43.4%

4.5%

0.4%

5.3%

1.7%

Americas

Middle East

Europe

Australia

AsiaAfrica

59.5%

14.3%

7.9%

2.2%

15.4%

0.7%

Opposite and Above: KBR employees demonstrate safety practices

Safety incident numbers include subcontractors and joint ventures.

Life Safety — The KBR WayKBR is committed to being the company against which all others benchmark their safety performance. The only acceptable safety performance standard is the one that strives to eliminate workplace injuries. At KBR, no job or service is so important that we cannot take the time necessary to perform our work safely. We recognize that we cannot accomplish this goal alone — it must be a team effort, which includes our subcontractors and anyone who works on behalf of KBR.

KBR has identified seven high-risk activities and the associated safety behaviors that should be practiced to prevent injuries. Compliance is mandatory and a condition of employment with KBR.

KBR’s “7 Keys to Life” are:

1. Working at Heights — Fall Prevention2. Heavy Equipment Operations3. Lifting Operations — Certified Operator, Riggers and

Signalmen4. Work Hazard Control — Housekeeping, Overhead Work

and Motorized/Rotating Equipment5. Confined Space6. Hazardous Energy7. Vehicle Operations

KBR measures all safety incidents against the “7 Keys to Life.” By analyzing where and when failures occur, we establish trends regarding a higher risk for serious incidents and implement corrective actions to prevent recurrences.

Leading Indicators ManagementManaging safety incidents to minimize lost time or restricted duty, or to focus only on the total recordable incident rate, does little to promote an incident- and injury-free workplace. By the time an incident occurs, it is too late. Managing “leading indicators” of an incident allows KBR to proactively approach safety, and identify and correct problems, before an accident happens. With a forward-looking perspective, KBR promotes positive interventions and data collection, rather than report failures or catalogue lessons from failures, and assesses safety issues versus negative safety events.

Total Safety Task InstructionsTotal Safety Task Instructions (TSTI) is a safety communication, task-planning and risk management system where knowledge is shared among all project stakeholders to ensure tasks are completed without incidents, injuries, occupational health hazards or damage to equipment, facilities and the environment. By identifying hazards associated with performing specific tasks, controls are installed

to eliminate hazards, communicate safe work practices and implement preventative measures. KBR employees study and complete a safety instruction card, which demonstrates that employees have the required knowledge of and training in these processes before starting work on a specific task.

The TSTI program maximizes safety awareness through teamwork among business unit leadership, project management and workers, in alignment with our belief that all employees should participate in safety planning and decision making, take ownership of work processes and focus on continuous improvement.

Total Safety Task ObservationTotal Safety Task Observation (TSTO) is an observation program designed to reinforce safe working behaviors and practices, and help employees take ownership of their safety. In this program, observers spend an allotted amount of time each day watching work being performed and engaging the workforce in positive conversations. Work performance is deemed “Safe,” “Unsafe” or “Unseen” — and work behaviors and processes are always commended or challenged in a positive way. Observers submit their findings to the Health, Safety and Environment Department, which collects and interprets the data. These observations help us measure whether our people exhibit more safe behaviors versus unsafe behaviors. If TSTOs indicate an increase in unsafe behaviors, KBR management implements corrective actions.

KBR’s TSTO program offers many benefits, including frequent opportunities for management and workers to engage in safety conversations and work together to effect improvements.

Toolbox Safety MeetingsSafety meetings are required daily, weekly or monthly, per project assignment. Additionally, KBR provides Toolbox Safety Meetings, which are required as part of our company’s safety culture. Before starting work, each contractor hosts a daily meeting during which superintendents describe the activities to be performed and review appropriate safety practices. These meetings, as well as all safety and general meetings at KBR, begin with the presentation of a safety value moment to keep safety at the forefront of employees’ minds.

Management at every level of KBR is involved in safety discussions. Discussion of company safety trends, initiatives and performance occurs at weekly division and monthly regional meetings. The Vice President of Quality, Health, Safety and Environment also hosts a weekly meeting that involves the distribution of safety reports that summarize all injury, vehicle, equipment, property and environmental incidents.

14 15Job Name Year Hours Type

Akzo Nobel – Pasadena, Texas Since Last Lost-Time Incident

Alaska Occ Jov V Jv – Richardson, Alaska Since Last Injury/Illness Incident

Aspire Capital Works – Aldershot / Salisbury Plain, U.K. Since Last Injury/Illness Incident

BASF – McIntosh, Alabama Since Last Lost-Time Incident

Big Foot Topsides CVX – Gulf of Mexico (U.S.) Without Recordable Incident

BP Chemicals – Decatur, Alabama Since Last Lost-Time Incident

Camp Bondsteel – Camp Bondsteel, Kosovo Without Lost-Time Incident

Children’s Hospital of Alabama – Birmingham, Alabama Since Last Lost-Time Incident

Chirag Oil – Caspian Sea (Azerbaijan) Injury/Illness-Free Project

Clinton Facilities – Houston, Texas Since Last Lost-Time Incident

Conlog Interim – Balkans (International) Since Last Injury/Illness Incident

Duke Medicine Pavilion – Durham, North Carolina Without Lost-Time Incident

DuPont – Delisle, Mississippi Without Lost-Time Incident

DuPont – LaPorte, Texas Without Recordable Incident

DuPont – Orange, Texas Without Lost-Time Incident

DuPont Kevlar – Cooper River, South Carolina Without Lost-Time Incident

Eastman Chemical – Longview, Texas Since Last Lost-Time Incident

Escravos GTL – Escravos, Nigeria Since Last Lost-Time Incident

ExxonMobil Facilities – Houston, Texas Without Lost-Time Incident

Goodyear – Pasadena, Texas Without Lost-Time Incident

International Paper – Kwidzyn, Poland Since Last Lost-Time Incident

International Paper – Svetogorsk, Russia Since Last Recordable Incident

International Paper – Valiant, Oklahoma Since Last Lost-Time Incident

JCCI O&M – Basra, Iraq Since Last Lost-Time Incident

Kashagan PMSC ROK – Kashagan, Kazakhstan Without Recordable Incident

KPC 1 Melawan Spile – Sangatta, Indonesia Without Lost-Time Incident

Progress Energy – Hamlet, North Carolina Without Lost-Time Incident

Sadara – Dhahran, Saudi Arabia Since Last Recordable Incident

Shell Const A&V SRC – Edmonton, Canada Since Last Lost-Time Incident

Shell Gasmer – Houston, Texas Without Lost-Time Incident

Shell Westhollow – Houston, Texas Since Last Lost-Time Incident

Skikda New LNG Train – Skikda, Algeria Since Last Lost-Time Incident

Solvay Chemicals – Longview, Washington Without Lost-Time Incident

Sonangol Refinery – Luanda, Angola Injury/Illness-Free Project

Syncrude ESP 25 1 Rebuild – Fort McMurray, Canada Without Lost-Time Incident

Tangguh LNG – Papua, Indonesia Since Last Lost-Time Incident

Texas Instruments – Stafford, Texas Without Lost-Time Incident

Yanbu Export Refinery – Yanbu, Saudi Arabia Without Recordable Incident

11

10

1

7

3

3

1

1

3

15

2

3

3

3

3

3

3

1

20

32

3

1

4

2

8

1

2

3

1

31

18

2

23

3

3

4

21

5

791,918

715,936

3,606,749

1,561,497

1,053,569

1,021,922

3,800,000

1,615,011

1,288,958

1,612,659

1,980,680

1,659,364

1,978,672

1,531,594

2,076,174

2,050,742

1,603,294

26,505,740

2,291,305

699,345

4,017,298

1,330,777

1,485,843

3,262,650

1,571,128

1,240,025

1,795,134

2,374,910

1,765,388

2,368,102

4,897,764

29,101,132

411,898

1,248,471

1,135,799

12,471,367

1,456,408

1,895,579

2011 – 2013 Major Safety Milestones

Above: KBR’s “7 Keys to Life” symbols represent different safety hazards

Environmental InitiativesKBR’s commitment to the environment is established in our COBC, and there are a myriad of ways that we deliver on this promise.

Environmental Management SystemThe ISO 14001 Environmental Management System, in which KBR is certified, uses internationally accepted standards to identify our impact on the environment and the actions KBR will take to minimize those impacts. For more information about the certification programs in which KBR participates, please refer to page 28.

Proud Project Portfolio According to project requirements and client expectations, KBR incorporates a variety of sustainable features into our work. From constructing buildings with features that minimize energy use to creating designs that are conscious of surrounding vegetation and wildlife, the environment is an integral consideration at our project sites. For more information about our projects, please refer to page 31.

Sustainable Operations In addition to the work that we perform on our projects, KBR leads by example by ensuring that our own operations are as sustainable and energy-efficient as possible. We constantly evaluate ways to minimize our carbon footprint and enact these initiatives when economically feasible. At KBR offices

worldwide, our efforts are centered on reducing our consumption of paper, natural gas, electricity and water. To help reduce carbon emissions from vehicle use at our corporate headquarters in Houston, Texas, KBR subsidizes a portion of our employees’ costs to use public transportation services to travel to and from work. In 2013, approximately 675 employees participated in the KBR Metro Rideshare program each month.

KBR also strives to make our office buildings safer and healthier for our employees and customers, as well as decrease our operating costs, by increasing energy efficiencies and reducing waste. We achieve this goal by working within nationally and internationally accepted green building certification systems, including LEED (Leadership in Energy & Environmental Design). For more information about these certification programs and our certified office spaces and projects, please refer to page 27.

KBR’s U.K. offices achieved the prestigious Carbon Trust Standard, having reduced more than 1,000 tons of carbon emissions.

Between 2011 and 2013, KBR’s U.S. offices recycled more than 1,950,000 pounds of paper.

Promoting Green Lifestyles at Green WeekEach year in honor of World Environment Day, KBR offices around the world host Green Week to raise awareness and explore actions for preserving our natural resources and living sustainably. This international celebration takes place in eight countries across five continents and features diverse activities ranging from lectures to community volunteer events that support environmental causes. Focus topics include themes like ecology and biodiversity, water resources, energy efficiency, waste and recycling, and carbon emissions.

Green Week activities include:

Green Week EXPO | Houston, Texas. Hundreds of employees attended this annual exposition, where they heard from environmental organizations that KBR supports, such as the Galveston Bay Foundation and Buffalo Bayou Partnership, and learned about products, services and local businesses that can help them enjoy healthier, more sustainable lives.

Cycle to Work Day | U.K., Australia and Indonesia. Employees opted out of their typical methods of transportation and traveled to work on bikes to promote the reduction of carbon emissions.

Waste Removal | Birmingham, Alabama. Employees cleaned a local lake to remove foreign waste.

Celebrating Green Technology | Singapore. A team of employees and their families visited Aerogreen Farm, which uses aeroponics technology — a method that saves up to 90 percent of water and land space — to grow vegetables.

A Green Education | New Delhi, India. This KBR office screened a documentary called Home, which discusses humans’ impact on the Earth’s environment; hosted a poster-making competition based on a “Save the Planet” theme to educate children about concepts such as deforestation, emissions and pollution; and initiated “Green Moments,” where each day employees shared their views on how individuals can contribute to the protection of our environment.* This data includes KBR’s three owned offices in Leatherhead and Greenford, U.K., and Birmingham, Alabama.

Reducing KBR’s Carbon Footprint, 2011 – 2013

230,846

34,492

309,032325,986

27,492 30,819

837,756

682,021

Greenford

Leatherhead

Birmingham (paper only)

553,360

0

200,000

400,000

600,000

800,000

1,000,000

201320122011

Total Weight of Office Waste* (Pounds)

Greenford

Leatherhead

Birmingham

0

246

808

0

281

740

0

328

835

0

200

400

600

800

1000

201320122011

Natural Gas Consumption* (tCO2e)

Greenford

Leatherhead

Birmingham

2013201220110

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

201320122011

4,588,845

2,918,308

5,433,490

4,165,421

2,242,127

3,053,036 3,064,966

2,242,127

2,920,157

Water Consumption* (Gallons)

Air

Car

Hotel

1,814

78,380

122 1,361

44,316

106 1,690

35,176

10

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

201320122011

KBR’s Global Travel Emissions (tCO2e)

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

201320122011Greenford

Leatherhead

Birmingham

2,802

2,372

3,662

2,448

2,121

3,443

2,315

1,743

3,493

Electricity Consumption* (tCO2e)

0

10,000

20,000

30,000

40,000

50,000

201320122011

45,11247,886

14,330 13,648

31,854

24,185

36,904

7,143

22,531

Greenford

Leatherhead

Birmingham

Paper Consumption* (Pounds)

16 17

18 19

Data includes executive, technical and administrative (ETA) employees. Data includes executive, technical, administrative (ETA) and craft employees.

Male

Female

Unknown/Undisclosed

17%

4%

79%

Between 30 and 50 Years

50 Years or More

30 Years or Less

33%

16%

52%

Innovative Technologies KBR’s commitment to developing and investing in new technologies, as well as enhancing existing technologies, dates back to our co-founder M.W. Kellogg’s research laboratory in the 1920s. We take pride in using the most advanced technologies in our industry for our customers’ benefit, and we consistently strive to improve efficiency.

In response to today’s environmental regulatory pressures and client demands for increased efficiency, KBR delivers innovative equipment and proprietary process technologies that offer feed stock flexibility, reliability, cost savings, reduced emissions and energy consumption, and performance advantages. KBR’s efforts give our clients a competitive edge while increasing the value of their assets and helping them operate within the confines of increasingly stringent government and industry standards.

Refining. KBR’s portfolio includes high-yield solutions for heavy crude oil processing, clean fuels, and refinery upgrading and modernization, all designed to safely improve the quality and amount of yield, increase capacity and

maximize on-stream time. We offer key technologies in fluid catalytic cracking, hydroprocessing, residuum upgrading and Veba Combi-Cracking (VCC).

Hydrogen, Ammonia & Syngas. As the world’s largest ammonia licensor, KBR has licensed process designs and basic engineering packages for more than 200 synthetic gas plants built around the world in the last 60 years — half of global ammonia production. Our key technologies include KRES™ for Ammonia Plant and Refinery Hydrogen Plant Revamp, Purifier™, PURIFIERplus™ Process, KAAP™ and KAAPplus™. These technologies provide low energy consumption, safe operations and superior on-stream time.

Coal Gasification. With unpredictable global prices and supply of crude oil and natural gas, there is increasing interest in technologies that improve the utility of low-quality, lower cost and preferably domestic feed stocks. KBR’s TRIG™ technology converts low-cost, low-rank coal into high-value, clean, particulate-free synthetic gas for power generation, chemicals, fuels and a variety of other industrial applications.

Fueling the Potential of AlgaeMore than 80 percent of the world’s energy demand is for fuel — making the development of clean fuels one of the most important challenges facing our society.

In partnership with government and other corporations, KBR is supporting a project to determine the most efficient way to produce affordable, high-value fuel from algae, using sunshine, nutrient-rich wastewater and carbon dioxide. KBR provided engineering services for the design of a pilot plant, the Solar Biofuels Research Centre (SBRC), in Queensland, Australia. The SBRC will identify the most efficient, cost-effective and environmentally friendly way to grow algae and produce biofuels.

Because algae has the added benefit of cleaning wastewater, biofuel technology also has exciting possibilities for waste recycling and wastewater treatment or clean-up in both developed and developing countries. Other potentially valuable products derived from algae include vaccines and pharmaceuticals.

Olefins. KBR’s state-of-the-art catalytic olefins technologies help clients boost propylene production and increase capacity without impacting the environment. Our SCORE™ steam cracking technology provides the highest olefins yields available in the industry, using a low-capital, high-efficiency product recovery system.

Chemicals. KBR has provided process technology, equipment and services for the production of specialty and intermediate chemicals on more than 700 projects. Our key technologies include NExOCTANE™, a flexible solution that allows

blenders to convert isobutylene to high-quality iso-octene/iso-octane, and Phenol capabilities to reduce emissions, maximize on-stream time and lower production costs.

Above, Top Left: Christies Beach, Australia / Above, Bottom Left: SBRC Algal Biofuel Pilot Plant, Australia / Above Right: TRIG™ Gasifier Pilot Plant, Alabama

From 2011 to 2013, KBR’s total spend with diverse suppliers was $100,820,833.

Occupation Types, 2013Employees by Country/Region, 2013

Workforce Diversity by Gender, 2013 Workforce Diversity by Age, 2013

Executive, Technical or Administrative (ETA)

Craft

38%

62%

Americas

Europe

Australia

Middle EastAsia

62%12%

8%

12%

5%

2%

Africa

KBR continues to bring to market new technologies that improve our clients’ profitability by maximizing conversion and energy efficiencies in a sustainable manner. We actively pursue partnerships and licensing technologies that enhance our ability to provide the best available solutions. We help our customers meet the challenges posed by the evolving environmental and market condition, and in response to changing regulatory pressures.

Alternative Energy SourcesAs the world looks for new, cleaner sources of energy, KBR is at the forefront. We believe that the global drive to reduce carbon emissions provides significant, long-term growth opportunities for our business. We invest in research and development proj-ects, and partner with governments and other corporations around the world, to identify viable sources of clean energy — and be part of the effort to create a sustainable future.

Already an established participant in the offshore and onshore wind farm industry, KBR is involved with projects to produce biofuels, or the processing of high-quality liquid fuel from living organisms or their byproducts. We are also engaged in engineering, procuring and constructing of renewable energy facilities such as waste-to-energy, which produces electricity and heat from the incineration of waste. This process is also a safe, technologically advanced method for waste disposal.

KBR is excited about the widespread future potential for these processes and continues to embrace our role in enhancing the viability of new energy sources.

The KBR Workforce KBR is proud of the diverse team that we have cultivated, with each valued member bringing a unique perspective and background to his or her role. Countries from every corner of the globe and a variety of age groups are represented within our workforce, and we offer abundant opportunities for both craft positions and executive, technical or administrative roles — anywhere in the world, on projects of international importance, within a broad range of industries.

At KBR, the hiring of diverse suppliers (including minority- and women-owned enterprises) and local or indigenous workers at our project sites continues to be a priority, as is the recruitment of women into the science, technology, engineering and math fields, where they are typically underrepresented. In recognition of the integrity, discipline, global perspective, teamwork, proven leadership and other important skills they contribute to the workplace, KBR is also proud to support and encourage the employment of military veterans.

Employee EngagementIn 2013, KBR distributed a survey to employees company-wide to determine what our people think of the company’s direc-tion. We are pleased to report that 60 percent of employees participated — a record number at KBR. Of the respondents, 82 percent think their colleagues are committed to KBR and 89 percent say their work gives them a sense of personal accom-plishment. Employees also give KBR high marks in teamwork, safety, diversity and offering a positive work environment.

By consistently soliciting our employees’ feedback, KBR ensures that we provide an open environment that encourages the best, most innovative work possible — and a place where our employees are proud to stay and develop their careers.

Employee Development and Well-BeingKBR values the contributions that each team member brings to our organization. None of the work that we perform would be possible without the dedication, talent, knowledge and skills of our thousands of employees around the world. Every day, our employees produce fresh ideas and innovative work that help KBR maintain our outstanding reputation across a variety of industries. And we believe in rewarding our employees for a job well done, from a competitive compensation and benefits package to standing firm on our value to take care of our peo-ple, through our commitment to integrity, health and safety.

KBR “Total Rewards” Employee Benefits:• Health insurance• Retirement savings plans• Income protection (short- and long-term disability)• Access to diverse continuing education and career

development opportunities• Health and wellness programs

Continuing Education and TrainingKBR UniversityWith KBR University (KBRU), employees around the world have access to a wealth of information and training designed to develop the knowledge and skills necessary for our employees to excel in their careers. Accessible from an online employee communications portal, we offer a variety of flexible, cost- effective e-learning options, from workshops and webinars to self-paced learning modules and e-books — within a range of topics and career disciplines. KBR’s success depends upon our support of a diverse workforce that is continuously learning and growing.

20 21Education Assistance ProgramIt is KBR’s intent that every employee realizes his or her full potential in an environment that values productivity and results. Beyond on-the-job training, we are pleased to help support employees in their efforts to develop skills that will enhance their performance and expand their opportunities for career advancement at KBR. All eligible employees may apply for financial support to complete formal education, at a KBR-approved or accredited institution, in an area of study that is relevant to their position.

Professional Development and VolunteerismIMPACTEstablished in 2001, IMPACT is an international network of developing KBR professionals. Any employee with seven or fewer years of experience — in any industry affiliated with KBR — is eligible to join. Its more than 1,500 members work diligently to create opportunities for personal and professional development, including informational, training, mentoring and networking events, as well as project site visits and team-building activities.

This organization flourishes in 10 countries across six continents: the U.S., U.K., Australia, South Africa, India, Indonesia, Singapore, Mexico, Angola and China. New IMPACT chapters are launching in Russia and Poland.

Primarily intended to motivate, retain and develop professionals who are just entering the workforce, IMPACT also exposes members to diverse leadership and volunteer opportunities with organizations that KBR supports. As a powerful force for positive action around the world, IMPACT

members participate in a variety of charitable and fundraising activities. Each year, two of IMPACT’s largest responsibilities are planning and hosting KBR’s Charity Golf Tournament (page 24) and Green Week (page 17).

The IMPACT Mentor Program connects upper-level KBR employees with IMPACT members as part of a long-term career development opportunity. Through a combination of educational, training and networking events, mentors’ experience and knowledge are shared with future KBR leaders. Mentors also assist mentees in establishing career goals.

Discover Engineering Committee For many children and teenagers, the spark of excitement about a possible career path originated with their interaction with a KBR employee.

KBR invests in the future through our Discovering Engineering Committee (DEC). The KBR-DEC is a volunteer organization that gives our engineers the opportunity to promote and generate enthusiasm for science, technology, engineering and math (STEM) careers. Through a variety of educational initiatives that include classroom visits, workshops, mentor programs and science fair judging, we aim to reach bright young students with the potential to be among future generations of KBR innovators — including low- income children and groups that are traditionally underrepre-sented in STEM careers, such as females and minorities. One of the KBR-DEC’s major annual events is Engineering Week, during which KBR hosts students from local schools at our offices and exposes them to a day of engineering education.

Employee Health and Wellness Wellness ProgramThe most successful and productive employees are usually the healthiest. Out of awareness for the many stressors and obligations that exist in our employees’ lives, the valuable contributions our dedicated employees make to our company and the challenges involved in maintaining wellness with so many competing demands in today’s world, KBR makes the

Based on independent employee reviews, job website CareerBliss ranked KBR the No. 4 Happiest Company in the U.S.

Between 2011 and 2013, 66,027 employees completed KBRU courses.

Employees dedicated 501,228 hours to KBRU courses, leadership development and classroom training.

Between 2011 and 2013, 586 employees acquired higher education or training through the Education Assistance Program.

KBR spent $1,721,690 on employees’ education.

Mission to MarsThey may still be in high school, but the students at Booker T. Washington High School in Houston, Texas, and the Ormiston Victory Academy in Norwich, England, are charting the course for a mission on Mars.

These students are part of a transatlantic partnership to design and plan every aspect of interplanetary living on a Mars base, from determining environmental conditions to constructing living facilities and work spaces. In addition to gaining an important, real-world introduction to the engineering field, these students are learning to work with remote project teams that offer a different perspective — a common scenario in today’s globally connected workplaces.

And KBR is the link that brought these students together. This program is part of the KBR-DEC’s global initiative to engage and mentor students in science and engineering projects, in collaboration with industry.

27,311Global employees

Above: Students in Texas communicate with students in England via Skype

health of our employees a top priority. Through our many health-focused programs, we want to show our employees that we care and want to retain them as valued, long-term team members. At KBR, we put our people first.

Destination: You. This program requires participants to wear a wireless activity tracker that counts the number of steps taken, distances walked and calories burned as they move around, exercise and perform daily tasks. Participants may view their progress from a personal webpage. The goal is for each participant to reach 1 million steps, which 1,458 employ-ees achieved between 2011 and 2013. Since the program’s inception, more than 1.4 billion steps have been taken.

Health Screenings. Between 2011 and 2013, 6,006 employees across the U.S., U.K. and Australia participated in free on-site health screenings. These screenings include a blood pressure, body fat and body mass index measurement; a cholesterol test (glucose, HDL/LDL and triglycerides) and a waist- circumference measurement. At the screening, participants may discuss their test results and options for improving their health with a health coach. As a result of this successful program, the numbers of high-risk cases for glucose and cholesterol levels, blood pressure and body fat percentage are steadily decreasing each year.

Flu Shots. Between 2011 and 2013, 5,124 employees received free flu shots at seven KBR offices throughout the U.S. We also provided flu shot vouchers for use at local pharmacies to 1,075 employees who work at locations where it is not feasible to provide on-site flu shots.

Healthy Steps. This points-based program rewards U.S. employees financially for taking specific measures to protect and improve their health. From attending a KBR on-site health screening or an annual physical with their personal physician, to completing 1 million steps through the Destination: You program, attending wellness coaching and receiving a dental exam, cancer screening and flu shot, employees have the opportunity to rack up points for each activity and receive a Healthy Reward — payable directly to each employee as an add-on to their regular paycheck. Between 2011 and 2013, 8,792 employees received a Healthy Reward.

In addition to these wellness programs, KBR offers other ini-tiatives to help employees stay healthy, including on-site health fairs, coaching for lifestyle and chronic conditions, on-site chair massages and discounts for fitness facilities, weight-loss programs and retailers that offer healthy food options.

Employee Assistance Program Since 1980, KBR’s Employee Assistance Program (EAP) has confidentially helped U.S. employees and their dependents resolve personal or work-related difficulties, such as stress or anxiety, job-related concerns, child-rearing, alcohol or sub-stance abuse, elder care, family relations, financial concerns and grief. EAP counselors, who are all licensed mental health professionals, help develop comprehensive assessments of problems and identify resources and courses of action. EAP

counselors are available by phone or in-person, and all services they provide directly are free.

Additionally, EAP counselors routinely consult with managers on issues that include workplace crisis intervention, high-ly critical employee interventions and individual employee performance problems, as well as provide supervisory training on a variety of topics involving change, human relations and communications, and stress management.

In the U.K., KBR works with an external firm to provide comparable services for our employees.

This program helps KBR develop and retain an outstanding workforce that is ready to serve our customers in the most professional and able manner possible, and it positively contributes to our financial success.

Dispute Resolution ProgramKBR’s Dispute Resolution Program (DRP) is available for U.S. employees who experience a work-related problem that they are unable to resolve on their own, or for managers who are responsible for handling or responding to employee concerns and would like assistance. The Ombudsman’s Office of the DRP is a confidential, neutral and informal place for KBR employees to discuss their issue “off the record” with a resolution professional.

DRP professionals provide internal and external options to help employees resolve issues that include the hiring process, termination, compensation, conflicts with co-workers or supervisors, policies and procedures, performance reviews and promotions. Staff members are available 24/7 for emergencies.

Corporate Giving and VolunteerismService is a value at KBR. We believe it is our obligation to add value to communities beyond the professional services we provide in the areas where we live, work and do business. Not only does community service generate goodwill and directly assist local populations in need, but above all, leveraging our company’s success to benefit the world around us is the right thing to do.

With a focus on organizations and causes that improve health, education and the environment, KBR contributed more than $7.4 million to charities between 2011 and 2013. Additionally, our company sponsored or participated in a variety of com-munity events and fundraisers.

KBR recognizes and is grateful for the outstanding generosity of our employees, who collectively contributed more than $2.6 million and approximately 70,000 volunteer hours to charitable causes between 2011 and 2013. As active donors and volunteers, our employees are our strongest brand ambassadors and provide a “heart and soul” connection between KBR and communities around the world.

KBR VolunteersWhenever KBR fulfills a need in the community, we deploy an official team of volunteers.

Our rich tradition of corporate volunteerism dates back to 1985, when our legacy company Brown & Root created the first corporate volunteer council in Houston, Texas, called the Brownbuilders Volunteer Council. Today, that same spirit of generosity still thrives at KBR’s global offices and within our two established Volunteer Councils in Houston, Texas, and Birmingham, Alabama — known as “KBR Volunteers.” In addition to these established councils, employee volun-teerism occurs worldwide, from the U.K. and Australia, to Singapore, Canada, Mexico and many other countries.

KBR employees volunteer at nonprof-it organizations and events that our company supports — a broad variety of exciting opportunities that enable networking, leadership development and expanded capabilities to positively impact communities.

Volunteer ChallengeTo encourage more employees to engage in community service and allow them to pursue their own volunteer experience, KBR initiated the Volunteer Challenge in 2012. Each quarter, employees from the Americas, Europe/Africa and Asia/Pacific regions compete to earn the highest amount of volunteer hours while serving at the charity of their choice. Using KBR’s online Volunteer Tracking Tool, employees report their time spent performing volunteer work.

KBR selects one individual and one team from each region as the quarterly winners. As their prize, KBR donates $500 to their selected charity. The Volunteer Challenge has so far benefit-ed many organizations, including the American Heart Association, National Multiple Sclerosis Society, British Red Cross, Habitat for Humanity, SPCA, Project C.U.R.E., Cub Scouts and the Fred Hollows Foundation.

22 23Between 2011 and 2013, KBR employees volunteered approximately 70,000 hours.

Event Funds Raised

March of Dimes BP MS 150 MS Walk Junior Achievement Susan G. Komen Foundation Race for the Cure

Total

KBR’s Top 5 Fundraising Beneficiaries, 2011 – 2013

Country Funds Raised

US $2,549,618 (95%)UK $98,183 (4%)Australia $30,097 (1%)

Total $2,677,898

Employee Charitable Giving, 2011 – 2013

KBR Wins Corporation of the Year for Blood Donations For patients in need, a safe supply of blood may be the difference between life and death. For every person who donates blood, up to three lives can be saved. At KBR, our employees consistently demonstrate how selfless and giving we can be.

$341,444$332,181$177,571$134,052

$37,480

$1,022,728

U.S./Canada Funds Raised

Health Education Environment

Total

$1,026,775 $1,317,894$664,936

$3,009,605 (40%)

Asia/Pacific Funds Raised

HealthEducation Environment

Total

Europe/Africa Funds Raised

Health Education Environment

Total

Other (Matching, Combined Regional Areas) $3,898,166 (52%)

Cumulative Total $7,489,762

KBR Charitable Giving, 2011 – 2013

$7,031$106,614$52,305

$165,950 (2%)

$110,172$303,629

$2,240

$416,041 (6%)

KBR Blood Drives, 2011 – 2013

51 blood drives2,288 volunteers/donors2,694 blood products donated8,106 lives potentially saved

Teeing Up the Green for CharityEach year, KBR’s Charity Golf Tournament supports the communities we serve and raises awareness about sustainability and our company’s worldwide efforts to reduce our environmental impact. The tournament is our showcase event for charitable giving, while promoting and encouraging environmental stewardship. Since the tournament’s inception in 2007, KBR has raised more than $2 million for 34 charities that align with our mission of improving health, education and environment.

Tournament Charitable Giving, 2007 – 2013

$171,000

$233,250 $220,000

$315,000$330,000

$416,000 $413,000

0

$100,000

$200,000

$300,000

$400,000

$500,000

200920082007 2012 201320112010

Total $2,098,250

Health $763,950

Education $758,650

Environment $455,650

Other/Disaster $120,000

36%

36%

22%

6%

KBR Goes to the Head of the ClassIn school, students learn fundamental skills in math, reading, science, history and other topics. But many students reach adulthood without knowing how to make informed career choices, interview for a job, create a budget or balance a checkbook. That’s where Junior Achievement (JA) comes in — bridging the gap between the academic lessons students receive in school and the practical skills needed for success.

JA relies on volunteer teachers from area businesses to educate students from elementary school to high school about topics ranging from personal finance to business principles and entrepreneurship. Since the mid-1980s, KBR’s volunteer teachers have positively impacted thousands of students and contributed to many successful outcomes.

24 25

For more stories about how KBR is positively impacting communities around the world, visit www.kbr.com/Social-Responsibility/Community

Above Left: Charity representatives pose with their checks / Above Right: KBR executives, vendors and suppliers play in the tournament

Above, Top Left: KBR walkers at the March of Dimes / Above, Top Right: KBR volunteers build a home for Habitat for Humanity / Above, Center Left: KBR volunteers at KBR Kids Day on Buffalo Bayou / Above, Bottom Left: KBR employees clean trash from Qatar beaches / Above, Right: KBR employees plant trees

Above: KBR employee teaches a class for Junior Achievement

At KBR, honesty, integrity and openness are among our values. For us, it’s not enough to merely state how we strive to achieve sustainable performance — we also share how other organizations grade our efforts. KBR actively participates in internationally known certification systems not only to be held accountable to our claims, but also to operate within a standard, global framework that governs how we do business and raises the bar for our performance.

Certification SystemsGreen BuildingKBR has extensive experience in designing and constructing environmentally friendly buildings to meet the standards of prestigious certification systems around the world. Many of our professionals are also knowledgeable about green building construction and have attained accreditations in these highly regarded programs to signify their expertise.

When KBR constructs buildings for our customers that achieve these certifications, the results include increased asset value; lower operating costs; improved efficiencies; enhanced conservation of water, electricity and natural gas; and an overall healthier and safer space for occupants.

LEED LEED (Leadership in Energy & Environmental Design) is an internationally recognized program administered by the U.S. Green Building Council to recognize structures that meet high standards for energy efficiency in design, construction and operations. Points are awarded to applicants based on the incorporation of certain energy-efficient features into a building, which determines the LEED certification level. From highest to lowest, the LEED certification levels are: Platinum, Gold, Silver and Certified.

AccountabilityAchieving third-party recognition for our global sustainability efforts 27

Accreditation KBR Professionals

LEED (U.S.) 73Green Advantage (U.S.) 20Australian Building Greenhouse Rating 9National Australian Built Environment Rating System 9Greenstar (Australia) 8BREEAM (U.K.) 2CEEQUAL (U.K.) 1Australian Green Building Infrastructure 1

Total 123

Our accountability to our stakeholders raises the bar for our performance.

Opposite: In Salah Gas Project, Algeria / Above Left: NASCAR Hall of Fame, North Carolina, certified LEED Silver / Above Right: Aspire Defence, the largest BREEAM project in the U.K.

KBR has 36 construction projects that have achieved or have applied for LEED certification. Of these projects, one has achieved LEED Platinum — the highest rating available. Only about 1,045 buildings in the world meet this standard.

More than 1,000,000 square feet of KBR’s leased office space has applied for or received LEED certification — that’s one-third of our leased office space.

OHSAS 18001 – Health and Safety Management System. OHSAS 18001 provides a systematic, standardized process for the identification, assessment and control of risks; verification of employee competencies; emergency response planning; incident review and the correction of nonconforming items. By adhering to these protocols, KBR ensures that we achieve an efficient, competent and productive workforce.

BREEAMAdministered by BRE Global, BREEAM (BRE Environmental Assessment Method) uses established standards of operating performance to evaluate the design and construction of buildings around the world. Points are awarded based on the impact that building features, across a variety of categories, have on the environment. Once a building is deemed to meet BREEAM standards, it is rated, from highest to lowest, as: Outstanding, Excellent, Very Good, Good and Pass.

NABERSThe National Australian Built Environment Rating System (NABERS) measures the performance of Australian buildings, examining indoor air quality, resource management and usage, and energy consumption. By using verified means to deter-mine environmental impact, such as utility bills, a building’s performance is converted to a star rating scale. From highest to lowest, the NABERS rating scale is: 6 Stars (Market-Leading Performance), 5 Stars (Excellent), 4 Stars (Good), 3 Stars (Average), 2 Stars (Below Average) and 1 Star (Poor).

Integrated Management System KBR’s Integrated Management System (IMS), certified by third party LRQA (Lloyd’s Register Quality Assurance), is the vehicle we use to consistently deliver high-quality services and products to our stakeholders and evaluate our success. Our IMS governs all of our business operations around the world, including business development, engineering, procurement, construction, human resources, and project and risk management. By adhering to our IMS, KBR adopts a standard, global approach for assessing, measuring and controlling the quality of our processes, tools, systems, procedures and deliverables. KBR’s IMS has received all quality, health, safety and environment certifications: ISO 9001, ISO 14001 and OHSAS 18001.

ISO 9001 – Quality Management System The focus of ISO 9001 is centered on customers, leadership and employee engagement, communications, systematic processes and the development of mutually beneficial supplier and subcontractor relationships. This system ensures that KBR controls and maintains the quality of the work we perform and verifies compliance with our existing programs and procedures through periodic audits to consistently produce high-quality services and products for our stakeholders. Our goal is to identify, assess and mitigate risks, while continually improving our processes and delivering quality output.

ISO 14001 – Environmental Management System ISO 14001 enables KBR to define the impact of our business on the environment, take actions to demonstrate our acceptance of responsibility for those impacts, communicate to our employees and subcontractors our expectations for the reduction of harmful impacts, and carry our accountability into the communities affected by our business — using strict, internationally accepted standards of performance.

28 29

KBR is the first EPC company in the world to receive IMS certifications in ISO 9001, ISO 14001 and OHSAS 18001, ensuring that we meet client requirements while protecting our employees and the environment — wherever we live, work and conduct business.

KBR Goes for the GoldThe end of a chapter in KBR’s history furthered our goal to minimize our environmental impact — and brought about a LEED Gold Existing Buildings certification for KBR’s corporate headquarters (KBR Tower) in Houston, Texas.

As part of the Houston Consolidation Project, a program to improve opera-tional efficiencies and conserve resources, KBR phased out our Clinton Drive complex. Transitioning out of such a widespread facility required disposing of thousands of obsolete items, including desks, chairs, shelves, filing cabinets, floor mats and cubicle walls. Rather than send these items to a landfill, we repurposed nearly everything within KBR or donated these items.

KBR relocated the majority of the standard modular furniture and walls from the Clinton Drive complex to the Eldridge Oaks and downtown Houston offices. Incorporating these existing materials helped KBR achieve many prestigious LEED certifications. More than 1,600 pieces of furniture were shipped to multiple KBR project locations.

During this process, KBR recycled more than 100,000 tons of metal, asphalt and concrete.

KBR’s Aspire Defence project is currently the largest BREEAM certification project in the U.K., with more than 410 buildings that meet BREEAM Excellent or Very Good standards.

KBR has three NABERS-certified offices in Australia. Our Melbourne office achieved a 4 Star Energy Rating, our Perth office earned a 5.5 Star Energy Rating and our Sydney office achieved two NABERS certifications — a 4.5 Star Energy Rating and a 4 Star Water Rating.

Accreditation

Ranked No. 101 in Newsweek’s Top 500 Greenest Companies (2012)Ranked No. 4 in Newsweek’s Top 43 Greenest Industrial Companies (2012)Ranked No. 4 in CareerBliss’ Top 50 Happiest Companies in America (2013)Ranked No. 37 in Engineering News-Record’s Top 100 Green Contractors (2013)Shell Executive HSSE Recognized KBR Gas Monetization for Significant Execution Efforts on Pearl GTL (2011)KBR International Government, Defence and Support Services Won the Royal Society for the Prevention of Accidents (RoSPA) Gold Safety Award (Three Consecutive Years – 2013, 2012 and 2011)

KBR Building Group Won the Associated Builders and Contractors Safety Training and Evaluation Process (STEP) Diamond Award (2013) and Platinum Award (2011)KBR International Government, Defence and Support Services Won Three Gold and Two Bronze Considerate Constructors Awards, Along With Two Runner-Up Awards for Most Considerate Site (2013)

One of Washington’s 50 Best Places to Work (2013) and No. 1 Best Place to Work (2012)KBR Building Group Won the North Carolina Department of Labor Gold Safety Achievement Award (Two Consecutive Years – 2013 and 2012)KBR Industrial Services Received a Houston Business Roundtable Best In Class Award (2011), Best in Category Safety Award (2013 and 2011) and Two Silver Star Awards (2011)Blood Center Corporation of the Year (2012)KBR Building Group Won the Associated Builders and Contractors National ABC Eagle Award (2012)Houston’s Healthiest Employer (2012)

Client Recognition for Phase 2 Commissioning & Start-Up Safety InitiativesPrestigious, Internationally Recognized Award for Safety Performance (Health and Safety Management, Workforce Environment and Incident Record)Pinnacle Award for Safety Performance in the Construction Industry

Recognizes U.K. Construction Sites for Excep-tional Levels of Consideration Shown Toward the Workforce, Public, Local Neighborhoods and the EnvironmentWashington Business Journal

Highest Level of Safety Achievement in North Carolina

Client-Nominated Recognition for Quality and Safety Performance

Gulf Coast Regional Blood CenterRecognizes Innovative, High-Quality Construc-tionHouston Business Journal

Prominent Sustainability Awards

Above: Benjamin Russell Hospital for Children, Alabama, certified LEED Gold

Above: KBR Tower in Houston, Texas, certified LEED Gold Existing Buildings

Each year, KBR participates in some of the world’s largest, most complex projects in remote, diverse and challenging environments — from deserts to deepwater fields, Arctic regions to rainforests, and urban areas to nature preserves. With each project, KBR assumes a responsibility for safe and successful completion — while meeting client expectations and benefiting our stakeholders.

Achieving these goals also means reducing our environmental impact, enhancing energy efficiencies, minimizing lost-time incidents and injuries, and hiring and training local labor to create job opportunities and encourage the development of thriving and successful communities. KBR takes pride in working with local, indigenous, and minority- and women-owned vendors and suppliers, in addition to offering the technical assistance and counsel to enable new partners to qualify as suppliers for our company. We meet — and frequently exceed — all established goals for local and diverse resourcing of labor, suppliers, vendors and materials.

KBR is pleased to showcase some of the most prominent sustainable projects in which we have participated.

Kellogg Joint Venture Gorgon (KJVG)Client: Chevron Location: Barrow Island, AustraliaScope: Engineering, procurement and construction management

The Chevron-operated Gorgon Project is developing the Gorgon and Jansz-Io gas fields, located between 80 and 124 miles off the northwest coast of Western Australia. It includes the construction of a three-train, 15.6 million tons-per-year (MTPA) liquefied natural gas (LNG) facility on Barrow Island and a domestic gas plant with the capacity to provide 300 terajoules of gas per day to Western Australia.

The Kellogg Joint Venture Gorgon (KJVG), an unincorporated joint venture between KBR, JGC, Hatch and Clough, is the Gorgon Project’s downstream engineering, procurement and construction management (EPCM) services contractor.

Barrow Island has been a Class A Nature Reserve since 1910 and is an internationally important conservation estate. KBR, as a joint venture partner in KJVG, has supported measures to protect the ecology of Barrow Island and its surrounds by:

• Conducting environmental issues and risk identification (ENVID) workshops and providing technical advice on the integration of environmental management requirements during the engineering design phase.

• Ensuring the downstream EPCM execution strategy was designed to minimize the environmental impacts on the island during downstream construction and commission-ing activities.

• Complying with measures to protect Barrow Island and its surrounds by adhering to the Gorgon Project’s Quarantine Management System (QMS), which directs the project’s quarantine operations. The project’s QMS is the largest non-government quarantine initiative in the world with accredited best practice by the United Nations Association of Australia.

• Developing the first marine use of color LED lighting to address Barrow Island environmental management requirements and design standards. After its debut on the Barrow Island project site, the light fitting was prototyped by the Queensland companies that assisted KJVG in its development and is now marketed as part of an LED range of products.

The Gorgon Project is operated by an Australian subsidiary of Chevron and is a joint venture of the Australian subsidiaries of Chevron (47.3 percent), ExxonMobil (25 percent), Shell (25 percent), Osaka Gas (1.25 percent), Tokyo Gas (1 percent) and Chubu Electric Power (0.417 percent).

ResponsibilityDelivering conscientious operations on a global scale — any project, any time, any place 31

Opposite: Tangguh LNG, Indonesia / Above Left: The Gorgon Project, Australia / Above Right: KJVG helped develop the first marine use of color LED lights at Gorgon

Our responsibility is to ensure safe, successful project completion — while meeting client expectations and benefiting the well-being of our stakeholders.

Aspire Defence (Capital Works) Client: UK Ministry of Defence Location: Aldershot and Salisbury Plain, UKScope: Construction services

Aspire Defence Capital Works is a KBR joint venture to develop living and working accommodations for nearly 19,000 military personnel based in the garrisons at Aldershot and across the Salisbury Plain. This construction project is part of the largest infrastructure Private Finance Initiative (PFI) contract ever awarded by the UK Ministry of Defence. Spread across 200 construction sites, this eight-year program involves the demolition, construction and renovation of hundreds of buildings.

With the overall goal to improve the quality of life for British army members, sustainability has been a key driver of the project from the beginning — and it is recognized as one of the top models for sustainable development in Europe. The construction program is currently the largest BREEAM (BRE Environmental Assessment Method) certification project in the U.K., with more than 410 buildings that have met BREEAM Excellent (new buildings) or Very Good (refurbished buildings) standards. More than 97 percent of demolition waste is crushed and reused on-site, minimizing waste sent to landfills, and 100 percent of maintenance timber and more than 96 percent of construction timber are procured through sustainable means (FSC or PEFC). The modular construction technique, where much of the construction takes place off-site, also minimizes waste and enhances speed, efficiency and quality control.

State-of-the-art lighting and control systems encourage energy conservation by optimizing lamp efficiency and discouraging occupant overuse, and Micro-Combined Heat and Power (mCHP) systems potentially save more than 1,000 tons of carbon dioxide per year compared to gas-fired condensing boiler systems. Water conservation is achieved by installing aerated faucets, dual-flush/low-flush toilets and an innovative

rainwater harvesting system that is used to reduce water usage when flushing toilets in certain buildings. A series of sustainable drainage systems convey clean water and absorb surface water run-off while preventing floods.

Nature conservation is also a priority. To minimize disturbances to local protected species, especially bats, the new buildings have more than 2,500 bat bricks, as well as specially designed bat cavity spaces, squeeze boxes in lofts and free-fly loft spaces — making this one of the largest bat mitigation projects in the U.K.

This project’s many recent awards include the Outstanding Contribution Award at the Wiltshire Wildlife Trust Corporate Green Awards, the Green Apple Environmental Best Practice Award and the British Safety Council Environmental 5-Star Audit Award.

Ichthys Project Onshore LNG FacilitiesClient: INPEX Location: Darwin, Australia

The Ichthys LNG Project is a joint venture between INPEX group companies (the operator), major partner TOTAL and the Australian subsidiaries of Tokyo Gas, Osaka Gas, Chubu Electric Power and Toho Gas.

The project is developing gas in the Browse Basin, approxi-mately 137 miles offshore of Western Australia. The gas will then be exported to onshore processing facilities in Darwin, Northern Territory, via a 552-mile pipeline.

In 2012, JKC Australia LNG Pty Ltd — a KBR joint venture with JGC Corporation and Chiyoda Corporation — was awarded the engineering, procurement and construction contract for all onshore facilities. This includes the liquefied natural gas (LNG) plant at Blaydin Point, its jetty and mod-ule offloading facility, and a 3,500-bed construction workers’ accommodation village at Howard Springs, 19 miles from the Darwin Central Business District.

KBR, as a partner of JKC, is supporting various sustainability initiatives on the project by:

• Working closely with partners, government and other stakeholders to enhance employment opportunities and create thousands of jobs for the region. Many of these op-portunities include training and apprenticeship programs and Aboriginal and Torres Strait Islander (ATSI) employ-ment aimed at developing people with the skills to meet current and future LNG market demands in the region.

By the middle of 2013, about 180 ATSI people were working on the onshore LNG facilities component of the Ichthys Project — two ATSI apprentices and 28 ATSI trainees were part of this group. Local ATSI business and project-sponsored registered training organization, the Larrakia Trade Training Centre,

ensured the trainees were ready to take on their new construction roles.

• Supporting and contributing to the local economy by engaging small businesses and suppliers to provide services to the project. Businesses awarded subcontracts range from cleaning and hospitality to security and site services, which have further generated local job and training opportunities.

By the middle of 2013 (one-and-a-half years after starting), the Ichthys Project has forecast more than $5 billion of commitments to the Northern Territory economy, of which contracts have been awarded by JKC and its subcontractors to more than 130 local businesses.

• Ensuring KBR’s safety philosophy permeates the onshore works — across Australian construction sites and the Asian fabrication yards. This includes the JKC leadership team and client representatives developing a set of safety values that are regularly communicated through HSE forums and comprehensive on-site training packages.

• Enhancing regional partnerships by working with partners and subcontractors to protect the environment and ensure the local ecosystem is enjoyed by generations to come.

The planting of hundreds of native seedlings on the banks of the Mitchell Creek by JKC, its subcontractors, Friends of Mitchell Creek and Greening Australia demonstrates that environmental responsibility is valued by KBR and is practiced with each project we undertake.

• Understanding the importance of contributing to the health and well-being of the communities KBR works in by supporting local community and sporting groups.

In 2012 – 2013, JKC sponsored the Wanderers Football Club, a local Darwin club made up of talented ATSI players. With longer-term sponsorship, the aim is to provide apprenticeships and traineeships to some of the players, providing healthy pathways to grow careers in construction.

Scope: Engineering, procurement and construction management

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Above Left: Ichthys LNG Project, Australia / Above Right: A team of environmental professionals ensure the local ecosystem is enjoyed by generations to come Above Left: Aspire Defence, U.K. / Above right: Bat bricks at the Aspire development

Escravos GTLClient: Chevron Nigeria Ltd. and NNPC Location: Escravos, Nigeria

Located 60 miles southeast of Lagos, the second most populous city in Africa, the Escravos Gas-to-Liquids (GTL) facility converts more than 300 million cubic feet of gas per day to 34,000 barrels of GTL products per day.

Cultural diversity was a hallmark of Escravos GTL, with more than 65 nationalities and the majority of 250 ethnic groups in Nigeria represented on this project. KBR also made it a priority to hire local workers and businesses — of the thousands of workers employed at this site, no more than a few hundred were from outside Nigeria. Escravos GTL also employed approximately 41 local contractors, who will take their experience gleaned from this job back into their communities — evidenced by the large number of houses and buildings that are newly completed or under construction in Warri, the nearby site where shipping, logistics and fabrication for Escravos was undertaken. The skills developed in these workers at Escravos and Warri Port are a success story and have been a major contributor to the port’s revitalization. It is our hope that the Warri Port Authority can use our successful partnership to attract new business and clients. Since its inception, Escravos GTL has invested nearly $29 million in human capital.

Escravos GTL has amassed 1.4 million student/trainee hours. KBR frequently hosted workshops and training events that workers consistently endorse. We relocated our expatriate artisan trainers to Warri on a full-time basis to evaluate and administer hands-on practical tests to thousands of candidates for skilled worker positions. The six-day new employee orientation, with a curriculum that focuses on every aspect of life at Escravos and Warri Port, was a success and served as the foundation for various other training programs. After completing the orientation, KBR issued each worker a

“training passport” to formally document all of the courses attended — which may be used to verify knowledge and skills as part of an application for future work. Nearly 10,000 new employees completed the orientation.

As part of our ongoing community development program, KBR hired a full-time Nigerian program coordinator and trained approximately 200 potential welders at three training facilities. The Welders Association from the Ijaw, Ilaje and Ekpan communities honored Escravos GTL with Certificates of Recognition & Excellence for our efforts on this initiative.

Scope: Project management and engineering, construction and procurement (EPC) management

Palm Beach Renewable Energy Facility Unit 2Client: Solid Waste AuthorityLocation: West Palm Beach, FloridaScope: Engineering, procurement and construction

The Solid Waste Authority (SWA) of Palm Beach County is expanding its award-winning solid waste management capabilities, adding a new waste-to-energy (WTE) facility — the first of its kind to be built in the United States in more than 15 years — to its Palm Beach County Renewable Energy Park, which will process solid waste for the county’s 1.4 million residents and businesses. With the capacity to process approximately 3,000 tons of municipal solid waste per day — more than 1 million tons annually — the new WTE facility will generate 75 megawatts (MW) — enough electricity to power 40,000 homes.

KBR’s contribution to this project involves the engineering and procurement of plant equipment, overall construction services and the installation of three MSW boilers, a GE steam generator (100 MW) and Air Quality Control System equipment. With these upgrades, this WTE facility will reduce greenhouse gas emissions by 874 million pounds per year and should offset the need to burn 85.5 billion cubic feet of natural gas to generate electricity over its operating life, an annual savings of 1.9 billion cubic feet of natural gas. Comparable WTE facilities produce 63 percent less carbon dioxide, 94 percent less sulfur dioxide and 62 percent less nitrous oxides (NO2) than traditional coal-fired plants. In fact, the SWA WTE facility will be the first to reduce NO2 emissions using catalytic technology. Through the best available control technology, this facility will have air emissions that are below permitted limits — the lowest emissions of any renewable energy facility currently combusting municipal solid waste in the U.S.

These modern WTE facilities meet or exceed the strictest federal and local environmental and air quality standards. The U.S. Environmental Protection Agency has recognized the municipal waste-to-energy industry for upgrading emission

control systems to exceed Clean Air Act standards, and consid-ers WTE a clean, reliable and renewable energy source with less environmental impact than most other sources of electricity.

Water conservation is key to the sustainability of this facility. The plant boasts zero wastewater discharge and an industri-al-sized rainwater harvesting system projected to capture 10 to 12 million gallons of rainwater each year from 7 acres of roof, reducing the demand for processed water by 15 percent. To further maximize water recycling and reduce the need for water treatment and disposal, a water management system directs water to areas of the facility according to the specific quality needed for different processes.

This WTE facility will also significantly reduce landfill waste in Palm Beach County by up to 85 percent due to an on-site compositing facility, two material recycling facilities and vegetation processing facility, as well as household hazardous waste collection and a network of five transfer stations. Further waste is reduced by the metals recovery system, which max-imizes the recycle of aluminum, steel and other ferrous and non-ferrous metals from the waste stream — more than 30,000 tons per year. The facility also operates on photovoltaic solar panels for added energy efficiency.

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Above: Solid Waste Authority Renewable Energy Facility Unit 2, Florida Above: Escravos GTL, Nigeria

Climate Change Adaptation Study for Five Pacific Island NationsClient: Asian Development Bank Location: Pacific IslandsScope: Information systems and strategy development

Pacific islands may be especially vulnerable to the possible impacts of climate change. To help better prepare for a potentially devastating situation, KBR developed a climate change adaptation strategy for Fiji, the Solomon Islands, Palau, the Marshall Islands and Timor-Leste.

Climate change may result in rising ocean levels and stron-ger storms, increasing risks for flooding, coastal erosion and drought. The adverse effects on food production and the use of land and water resources, alongside the potential damage to infrastructure and decline in human health, may lead to catastrophic losses and large-scale migration within and across national borders.

To address these issues, KBR identified and reviewed potential pilot projects, including the use of drought- or salt-tolerant plants to improve the resilience of local plant life to reduced rainfall and increased groundwater salt levels; mangrove forests to mitigate the effects of storm waves and prevent coastal erosion; and coastal mapping to better monitor changes and guide land-use planning. KBR recommended the development of cyclone and flood shelters to protect residents, as well as climate change awareness programs.

These island countries need databases containing information about their vulnerability to sea- or flood-level combinations and the impact of levee and storm barrier breaches. With such information, government policymakers can assess the resilience of the island’s infrastructure to guide planning, land use and the prioritization of any protective structures. Furthermore, KBR produced an adaptive strategy to incorporate the predicted climate change scenarios into the design of these structures.

Research and Academic Center at Lake NonaClient: University of FloridaLocation: Orlando, FloridaScope: Construction management

Home to the University of Florida’s College of Pharmacy, Institute on Aging and Institute of Therapeutic Innovation, this 115,000-square-foot facility includes space for research, laboratories, classrooms, offices, and conference and support areas. This building is the first major UF research facility to be constructed outside the main Gainesville campus.

The building owes its LEED Platinum certification to these features:

• A terra cotta rain screen that provides extra insulation to improve energy efficiency, while preventing damage from excess moisture

• A stainless steel sunshade that reduces heat load and in-creases energy efficiency by blocking excess sun exposure

• The first application of “chilled beams” in Florida• Energy recovery units, heat exchangers and fume hoods

with exhaust fans• On-site Central Energy Plant that minimizes system

redundancies

LEED Platinum is the highest LEED rating available — and this award marks the first time in KBR’s history that a building project has achieved LEED Platinum. Additionally, this project won the 2013 ABC Eagle Award for Excellence in Construc-tion and was a Finalist for Project of the Year from Associated Builders and Contractors of Central Florida, as well as a Best of 2013 Award in the Research/Higher Education category from ENR Southeast.

Hallett Wind FarmsClient: AGL Energy Limited Location: Near Hallett, Australia (105 miles north of Adelaide)Scope: Construction management

This development of five wind farms — the largest such development constructed in Australia — generates, at full speed, enough renewable energy to power 40,000 average Australian households per year and abate approximately 250,000 tons of carbon dioxide annually. KBR’s scope of services included project management, document control, contract administration, schedule control, cost control, prog-ress verification and payment certification, site management, health and safety inspection and audit, progress reporting, meeting facilitation, risk management and quality control. Each stage of the development involved associated connection and infrastructure works, such as substations, access roads, 33-kilovolt collection, SCADA systems and switchyards.

Each 2.1 megawatt (MW) turbine is 262 feet high with three turbine blades that are 144 feet long. The wind farms deliver a combined generation capacity of 298 MW.

The Hallett Wind Farms have contributed in excess of $110 million to the local economy, and its energy-efficient achievements leave a lasting legacy for the emerging renewable energy industry. KBR’s successful track record in constructing the wind farms for AGL resulted in our inclusion within the membership of AGL’s Renewable Energy Panel from 2009 to 2014. This recognition increases KBR’s profile in the green energy industry and positions us well for securing future contracts for renewable energy projects.

In 2011, KBR won Project of the Year for the Hallett Wind Farms from the Australian Institute of Project Management.

Duke Medicine Cancer CenterClient: Duke University Health SystemLocation: Durham, North CarolinaScope: Construction management

The seven-floor, 269,956-square-foot Duke Medicine Cancer Center is a world-class facility that houses all of the Duke University Health System’s cancer programs — giving patients the convenience of accessing advanced, multidisciplinary treatment within one space. With the goal of achieving maximum patient comfort and the highest standards of energy efficiency, its features include:

• 8,100-square-foot green roof space with an irrigation system and 4,400-square-foot roof garden

• Rooftop Xero Flor mats, which are pre-cultivated with climate-compatible plants, resistant to weeds and help reduce the amount of uncollected stormwater

• A reclaimed water system that diverts water collected from the roof or recycled from air-handling units to either the three penthouse cisterns for rooftop irrigation or to the underground, 100-gallon cistern that provides water for all the landscaping around the facility

In addition to a LEED (Leadership in Energy & Environmental Design) Gold certification, awards for this project include Best of 2012 from Engineering News-Record, as well as the ABC Eagle Award for Excellence in Construction and Finalist, Project of the Year from the Associated Builders and Contractors of the Carolinas.

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Above Left: Hallett Wind Farms, Australia / Above, Top Right: Duke Medicine Cancer Center, North Carolina / Above, Bottom Right: Rooftop garden at Duke Medicine Cancer Center Above Left: KBR’s climate change adaptation study will mitigate risks for Pacific islands / Above Right: Research and Academic Center at Lake Nona, Florida

Pacific NorthWest LNG

The Pacific NorthWest facility will be one of the first initiatives to commercially produce liquefied natural gas (LNG) in British Columbia, a region that is new to LNG development.

KBR and JGC, in a joint venture, have been involved with the Pacific NorthWest facility since its inception in 2011. Once feasibility studies and front-end engineering design (FEED) are complete, KBR and JGC will assist with site development and will implement programs to minimize the impact of the LNG facility on the surrounding wildlife and environment.

Located on Lelu Island approximately 3 miles south of Prince Rupert, British Columbia, and adjacent to Port Edward, the project site is situated within an environmentally sensitive area. KBR recommended this location after a detailed site selection study to evaluate sustainability issues such as the impact on water and plant life; indigenous personnel relocation; availability of local utilities; and safety and geohazard concerns, including the risk of floods, tsunamis and erosion.

Preliminary soil tests on Lelu Island have identified the need for significant pre-construction preparation, and site development will commence upon completion of an environmental assessment. Area surveys will detect the presence of protected species, sacred trees and archaeological items. Significant archaeological elements, primarily in the form of culturally modified trees, have already been discovered within and around the project site.

The Pacific NorthWest site and Lelu Island lie within the asserted traditional territories of the Coast Tsimshian First Nation (CTFN), part of the larger Tsimshian people of north-ern British Columbia. A protocol agreement exists between the Prince Rupert Port Authority and the CTFN that covers

training, employment and post-secondary education programs for the CTFN, as well as the pursuit of opportunities for business and economic development.

Directly and through local and regional project contractors, this project will employ local Tsimshian workers. KBR and JGC will be actively involved in developing the local workforce during the project’s construction phase, and will train these workers to manage facility operations. KBR seeks to establish a benchmark for constructive, positive engagement with these regional communities and leave a legacy of excellence in environmental performance.

Client: Pacific NorthWest LNG Limited Partnership (Petronas/Progress Energy)Location: Lelu Island, Port Edward, British ColumbiaScope: Feasibility studies, pre-FEED, FEED and early detailed engineering

Kitimat LNG Client: Chevron Canada Limited and Apache CorporationLocation: Kitimat, British ColumbiaScope: Early works, pre-FEED and FEED

Kitimat LNG is located approximately 9 miles southwest of Kitimat, British Columbia, near the community’s industrial zone, an existing pipeline system and a natural deepwater port. With a projected capacity of 5 million metric tons of liquefied natural gas (LNG) per year, potential capacity is estimated to be 10 million metric tons per year or more. In all, there is approximately 19 trillion cubic feet of combined recoverable and marketable natural gas at this facility.

In addition to the management of early works and initial engineering to support project development, KBR’s scope of work includes front-end engineering design (FEED) for LNG process units, associated infrastructure, and administration and marine facilities.

From its inception in 2012, the development of this facility has placed a high priority on sustainability considerations. The project site is located in an environmentally sensitive area with fauna populations that include bears, wolves, moose, birds of prey, salmon, whales and seals. Kitimat LNG also has an on-site wetland and is surrounded by environmentally sensitive water bodies. KBR monitors water quality to verify that construction activities are not negatively affecting the sensitive salmon spawning and rearing habitat.

Before construction began, KBR surveyed work areas for the presence of both protected species (tailed frogs and western toads) and non-threatened species (salamanders and newts). If found, KBR relocated these species to suitable habitats outside work zones. During development, we took measures to protect aquatic, avian and terrestrial wildlife and minimize the disruption to their movements, including the designation of wildlife lanes and the construction of runways.

KBR’s wildlife monitors identify when local bear populations awaken from hibernation and ensure a safe working environment for site personnel and visitors. During this time, work is restricted within the prime bear foraging habitats adjacent to the project site. These measures provide protection and minimize disturbances for the bears, and offer them unimpeded access to spawning salmon along the water bodies that border the project site.

Through contractors like KBR, this project is creating jobs, as well as educational and training opportunities, for members of the Haisla Nation, the indigenous people who own the property on Douglas Channel on which Kitimat LNG is located. Developing the local and indigenous workforce will provide many economic benefits to the community.

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Above Left: Pacific NorthWest LNG, British Columbia / Above Right: KBR employees conduct area surveys of native vegetation on Lelu IslandAbove Left: Kitimat LNG, British Columbia / Above Right: Workers’ accommodation units at Kitimat LNG

USAREUR Support Contract II (USC-II)Client: U.S. Army Corps of Engineers and U.S. Army Europe Location: Camp Bondsteel, KosovoScope: Operations, maintenance and logistical support services

Since 1995, KBR has supported U.S. Armed Forces deployed in the Balkans. Under USC-II, KBR provides operations, maintenance and logistical support services for contingency operations and military readiness exercises.

At Camp Bondsteel, a KBR-constructed camp built to accommodate 6,000 soldiers, KBR implemented energy- efficient upgrades to reduce operating costs, conserve limited natural resources and protect the surrounding environment:

• Used recycled pond water for dust abatement on base roads and for irrigation of sports fields, which saved more than 18.2 million gallons of well water and reduced the electricity consumption associated with pumping and treating well water

• Replaced 550 air conditioners using R-22 refrigerant with units using R-407C refrigerant, which depletes no ozone in the event of a refrigerant leak

• Installed bathroom faucet aerators and toilet flush mechanisms to achieve an 80 percent and 33 percent water use reduction respectively

• Disconnected every other light fixture on SEAhuts porches to reduce material use, the waste stream of de-pleted bulbs and electricity consumption by 10 percent — without negatively impacting personnel safety

• Reduced working hours in some offices from 10 hours per day to eight hours per day, realizing a further 20 percent reduction in electricity consumption due to less heating and lighting requirements

• Designed, fabricated and installed a refuse-collection chute to directly transfer trash from the refuse storage area into subcontractor trash collection trucks, eliminating the need for greenhouse gas-emitting Bobcats to load trash

South Carolina 787 Facility ExpansionClient: The Boeing CompanyLocation: North Charleston, South CarolinaScope: Design-build and general contracting

Boeing’s high-profile renovation and expansion of the final assembly and delivery facilities for the 787 Dreamliner pro-gram represents the largest single capital investment in South Carolina’s history. KBR worked closely to ensure that Boeing’s facility incorporated many energy-efficient features:

• Plant operations are fed by compressed air, chilled water, fire protection, domestic water, natural gas, data and electrical services from the new Central Utilities Building

• Condensate harvesting and water-efficient fixtures provide the 692,000-square-foot building with 48 percent overall water savings

• 100 percent renewable energy is harvested from a 2.6-megawatt photovoltaic solar panel array installed on the roof of the Final Assembly Building

Four of the on-site facilities have achieved LEED (Leader-ship in Energy & Environmental Design) Gold status. Project awards include the National Best of Best 2012 Award from Engineering News-Record, Best Industrial/Manufacturing Project of 2012 from ENR Southeast, National ABC Eagle Award for Excellence in Construction from Associated Builders and Contractors and safety awards from the South Carolina Chamber of Commerce and the Department of Labor, Licensing and Regulation.

DuPont – LaPorte, TexasClient: DuPontLocation: LaPorte, TexasScope: Construction and maintenance services

KBR performed a variety of construction and maintenance services in support of this DuPont facility, which produces herbicides and insecticides, vinyls, and sulfuric and hydrofluoric acid for the manufacture of various products. In support of the local community, KBR hired a core group of 170 local workers, as well as local businesses, to supply equipment rentals and maintenance, industrial cleaning, mechanical inspections and specialty industrial services.

For all incoming workers and subcontractors, KBR offered a site orientation that focused on safety and hazard awareness, crane operator training as required and National Center for Construction Education and Research (NCCER) training. The site training coordinator worked in conjunction with the Houston Area Safety Council.

KBR’s technology innovations have helped this facility meet Texas Commission for Environmental Quality requirements and achieve minimized waste and improved efficiencies. KBR installed a farm emissions reduction vent header/incinerator, added restricted spray valves into the systems to reduce disposal fees and participated in facility recycle programs. The Texas Chemical Council recognized this project with a Best in Texas Safety and Environmental Award.

In the community, KBR participated in the annual “Baytown Santa” Christmas charity program, donating toys for children from low-income families during the holidays.

Newlands Coal Extension ProjectClient: Glencore (formerly Xstrata Coal)Location: Newlands, Queensland, AustraliaScope: Environmental impact statement and approvals

KBR completed environmental and social impact assessment, and assessed water management and vegetation offset require-ments to assist Glencore to plan the extension of their existing open cut coal mine at Newlands, in Central Queensland, and gain the necessary Government approvals.

The outcomes from these studies were important inputs to Glencore’s mine planning and development, and were used to balance environmental and social constraints with the works necessary to extend the mine.

Key elements included minimising impacts on high value native vegetation and associated fauna habitats, designing water management measures to prevent adverse effects on downstream fresh water systems, and effectively planning the management of social and community issues.

In addition, an ecological offset strategy was developed, utilising the nature refuge which Glencore maintains and manages within their land for this purpose. This strategy demonstrated that the improved ecological values delivered in the offset area would effectively offset the necessary impacts on vegetation and habitats from the mine extension.

Glencore’s primary water management objective was to min-imize mine water discharge from the site through improving the water efficiency of the mine design and operations and bal-ancing water supply and demand. To achieve this KBR studied the potential impacts on existing natural flow paths, developed a mine water management model, and advised on mine water recycling and reuse practices.

The work completed by KBR’s project team will assist Glencore to integrate environmental and social values into the planning and operation of the mine extension.

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Above Left: Camp Bondsteel, Kosovo / Above, Top and Bottom Right: Boeing 787 Facility, South Carolina Above: A KBR worker operating a welder

GRI IndicatorGRI Indicator Description

2013 2012 2011

1.1 Statement from the most senior decisionmaker of the organization (e.g., CEO, chair, or equivalent senior position) about the relevance of sustainability to the organization and its strategy.

1.2 Description of key impacts, risks, and opportunities.

Our rate of growth and the success of our business depend upon our ability to attract, develop and retain a sufficient number of affordable trained engineers and other skilled workers, either through direct hire or the acquisition of other firms employing such professionals. The market for these professionals is competitive. If we are unable to attract and retain a sufficient number of skilled personnel, our ability to pursue projects may be adversely affected, the cost of executing our existing and future projects may increase, and our financial performance may decline.A significant portion of our revenue is derived from foreign operations, which exposes us to risks inherent in doing business in each of the countries where we transact business. The occurrence of any of the risks described below could have a material adverse effect on our business operations and financial performance. With respect to any particular country, these risks may include but are not limited to:• Expropriation and nationalization of our assets in that country• Political and economic instability• Civil unrest, acts of terrorism, force majeure, war or other armed conflict• Currency fluctuations, devaluations and conversion restrictions• Confiscatory taxation or other adverse tax policies• Governmental activities or judicial actions that limit or disrupt markets, restrict payments, limit the movement of funds, result in the deprivation of contract rights or result in the inability for us to obtain or retain licenses required for operationDue to the unsettled political conditions in many oil-producing countries and other countries where we provide governmental logistical support, our financial performance is subject to the adverse consequences of war, the effects of terrorism, civil unrest, strikes, currency controls and governmental actions. Our operations are conducted in areas that have significant amounts of political risk. In addition, military action or continued unrest in the Middle East could impact the supply and price of oil and gas, disrupt our operations in the region and elsewhere, and increase our security costs worldwide. Some of our services are performed in high-risk locations, such as Iraq, Afghanistan, Nigeria, Algeria, Egypt and Saudi Arabia, where the country or location and surrounding area is suffering from political, social or economic issues, war or civil unrest. In those locations where we have employees or operations, we have and may continue to incur substantial costs to maintain the safety of our personnel. Despite these precautions, we have suffered the loss of employees and contractors, which could expose us to claims and litigation. In the future, the safety of our personnel in these and other locations may continue to be at risk, exposing us to the potential loss of additional employees and contractors. For more information, please view our Annual Report.

2.1 Name of the organization. KBR, Inc.

2.2 Primary brands, products, and/or services. The reporting organization should indicate the nature of its role in providing these products and services, and the degree to which it utilizes outsourcing.

KBR, Inc. and it subsidiaries (collectively, “KBR”) is a global engineering, construction and services company supporting the energy, hydrocarbons, government services, minerals, civil infrastructure, power, industrial and commercial markets.

2.3 Operational structure of the organization, including main divisions, operating companies, subsidiaries, and joint ventures.

KBR offers a wide range of services through our business groups: Hydrocarbons; Gas Monetization; Infrastructure, Government & Power (IGP); and Services. We enter into joint ventures and alliances with other industry participants to reduce and diversify risk; increase the number of opportunities that can be pursued; capitalize on the strengths of each party; facilitate relationships between us, our venture partners and different potential customers; and allow for greater flexibility in delivering our services based on cost and geographical efficiency. Our significant joint ventures and alliances are described below. All joint venture ownership percentages presented are as of December 31, 2013.

JKC Australia LNG Pty Ltd (JKC) is an unincorporated joint venture consisting of JGC Oceania Pty Ltd (JGC), 40 percent ownership interest; Kellogg Brown & Root Pty Ltd (KBRPL), 30 percent ownership interest; and Chiyoda Corporation (Chiyoda), 30 percent ownership interest, for the purpose of design, procurement, fabrication, construction, commissioning and testing of the Ichthys Onshore LNG Export Facility in Darwin, Australia (Inpex LNG Project). The project will be executed using two joint ventures in which we own a 30 percent equity interest. The investments are accounted for using the equity method of accounting and reported in our Hydrocarbons business group.

Kellogg Joint Venture (KJV) is an unincorporated joint venture consisting of JGC Corporation (JGC), 30 percent ownership interest; Hatch Associates PTY LTD (Hatch), 20 percent ownership interest; Clough Projects Australia PTY LTD (Clough), 20 percent ownership interest; and KBR E&C Australia Pty Ltd (KBR E&C Aust), 30 percent ownership interest, for the purpose of design, procurement, fabrication, construction, commissioning and testing of the Gorgon Downstream LNG Project, located on Barrow Island off the northwest coast of Western Australia. We hold a 30 percent interest in the joint venture, which is consolidated for financial accounting purposes and reported in our Hydrocarbons business group.

Aspire Defence Holdings Limited (Aspire Defence) is a joint venture incorporated in the United Kingdom, England and Wales between KBR (U.K.) Investments Limited (“KBRUKIL”), 45 percent ownership interest; Carillion Private Finance (Defence) Limited (Carillion), 127.5 percent ownership interest; and two financial investors formed to contract with the UK Ministry of Defence (MoD) to upgrade and provide a range of services to the British army’s garrisons at Aldershot and around the Salisbury Plain in the U.K. We own a 45 percent interest in Aspire Defence, which is reported in our Ventures business unit that is included in our Other group. In addition, we own a 50 percent interest in each of the two joint ventures within our IGP group that provide the construction and related support services to Aspire Defence. We account for our investments in these entities using the equity method of accounting.

Mantenimiento Marino de Mexico, S. de R.L. de C.V. (MMM) is a joint venture formed under a Partners’ Agreement with MMM-SS Holdings, LLC (50.01 percent ownership interest) and Grupo R-affiliated entities. The principal Grupo R entity is Servicios Maritimos de Campeche, S.A. de C.V. (49.99 percent ownership interest). The Partners’ Agreement covers five joint venture entities executing Mexican contracts with PEMEX. The MMM joint venture was set up under Mexican maritime law to hold navigation permits to operate in Mexican waters. The scope of the business is to render maintenance, repair and restoration services of offshore oil and gas platforms, and provisions of quartering in the territorial waters of Mexico. We own a 50 percent interest in MMM and in each of the four other joint ventures. We account for our investment in these entities using the equity method of accounting within our Services business group.

2.4 Location of organization’s headquarters.

601 Jefferson Street, Suite 3400 Houston, Texas 77002

2.5 Number of countries where the organization operates, and names of countries with either major operations or that are specifically relevant to the sustainability issues covered in the report.

We conduct business in more than 70 countries. KBR’s major operations in regards to revenue are in the following countries/regions: U.S., Asia/Pacific (including Australia), Africa, Europe, Middle East, Iraq and Canada. KBR’s major operations in regards to property, plant and equipment are in the following countries: U.S. and U.K.

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Global Reporting Initiative (GRI) 3.1 Table

Please view the Letter from the CEO on page 5.

GRI IndicatorGRI Indicator Description

2013 2012 2011

3.9 ”Data measurement techniques and the bases of calculations, including assumptions and techniques underlying estimations applied to the compilation of the Indicators and other information in the report. Explain any decisions not to apply, or to substantially diverge from, the GRI Indicator Protocols.”

For U.K. facility data (Greenford and Leatherhead), U.K. energy measurements follow the Carbon Trust Standard. For U.S. facility data (Birmingham), U.S. energy measurements follow the Environmental Protection Agency (EPA) recommendations.

3.10 Explanation of the effect of any re-statements of information provided in earlier reports, and the reasons for such re-statement (e.g., mergers/ acquisitions, change of base years/periods, nature of business, measurement methods).

There were no re-statements of information from prior reports in the 2011-2013 Sustainability Report.

3.11 Significant changes from previous reporting periods in the scope, boundary, or measurement methods applied in the report.

The 2007-2010 Sustainability Report was GRI-referenced. The 2011-2013 Sustainability Report follows GRI 3.1.

3.12 Table identifying the location of the Standard Disclosures in the report.

3.13 Policy and current practice with regard to seeking external assurance for the report. If not included in the assurance report accompanying the sustainability report, explain the scope and basis of any external assurance provided. Also explain the relationship between the reporting organization and the assurance provider(s).

KBR did not obtain third-party verfication for the 2011-2013 Sustainability Report and is currently evaluating third-party verification for our next report.

4.1 Governance structure of the organiza-tion, including committees under the highest governance body responsible for specific tasks, such as setting strategy or organizational oversight.

The Board of Directors (the Board) of KBR, Inc. (KBR) is comprised of nine members, eight of whom are independent directors. KBR’s Bylaws authorize the Board to appoint such committees as they deem advisable, with each committee given the authority to perform the duties as determined by the Board. A substantial portion of the analysis and work of the Board is done by standing Board committees. A director is expected to participate actively in the meetings of each committee to which he or she is appointed. At this time, the Board has four standing committees to which it has delegated certain duties and responsibilities: Audit, Compensation, Nominating and Corporate Governance (NCG), and Corporate Social Responsibility (CSR). Each committee is comprised of four independent directors. The eight independent directors and the committees on which they serve are: W. Frank Blount, 75 (Audit and NCG) Loren K. Carroll, 70 (Lead Director, Compensation, and NCG Chairman) Linda Z. Cook, 55 (Compensation and CSR) Jeffrey E. Curtiss, 65 (Audit Chairman and NCG) John R. Huff, 67 (Compensation and CSR) Lester L. Lyles, 67 (Audit and CSR Chairman) Jack B. Moore, 60 (Audit and CSR) Richard J. Slater, 67 (Compensation Chairman and NCG) William P. Utt, 56 (Chairman of the Board, CEO and President) The Board represents the interests of KBR’s stockholders in perpetuating a successful business. It is the responsibility of the Board to provide oversight of the effectiveness of management’s policies and decisions, including the execution of our strategies, with a commitment to enhancing stockholder value over the long term. To this end, Board members are expected to act in the best interests of all stockholders, be knowledgeable about our businesses, exercise informed and independent judgment, and maintain an understanding of general economic trends and conditions, as well as trends in corporate governance. In addition, it is the Board’s policy that Board members are expected to make every effort to attend the meetings of the Board and committees of the Board upon which they serve, as well as stockholder meetings. All of KBR’s incumbent directors attended 75 percent or more of the aggregate of all meetings of the Board and of committees during 2013. KBR’s Corporate Governance Guidelines provide that all Board members should attend our annual stockholder meetings, and all of our Board members attended our 2013 Annual Meeting of Stockholders. The Board is in the process of becoming declassified. The declassification is being phased in over two years. Commencing with the 2014 Annual Meeting of Stockholders, the Board will cease to be classified and all directors will be elected annually, with nominees standing for election to one-year terms. The Audit Committee reviews and reports to the Board the scope and results of audits by our principal independent public accountants and our internal auditing staff, and reviews with the principal independent public accountants the effectiveness of our system of internal controls. It reviews transactions between us and our directors and officers, our policies regarding those transactions and compliance with our Code of Business Conduct. The Audit Committee also engages our principal independent registered public accounting firm for each fiscal year, reviews the audit and other professional services rendered by our principal independent registered public accounting firm, and periodically reviews the independence of our principal independent registered public accounting firm. The Compensation Committee reviews and recommends to the Board the compensation and benefits of our executive officers, establishes and reviews general policies relating to our compensation and benefits, and administers the compensation plans in which our executive officers participate.

The NCG Committee’s responsibilities include, but are not limited to:• Developing, implementing and periodically reviewing KBR’s corporate governance guidelines• Developing and implementing a process to assess Board and committee effectiveness• Identifying individuals qualified to become Board members, consistent with Board-approved criteria• Determining the composition of the Board and our committees; including selection of the Director nominees for the next annual meeting of stockholders• Periodically reviewing the compensation paid to non-employee directors (including Board and committee chairpersons) in the form of annual retainers and meeting fees, if any, and making recommendations to the Board regarding any adjustments

The Corporate Social Responsibility Committee’s responsibilities include, but are not limited to:• Reviewing the status of KBR’s health, safety and sustainable development policies and performance, including processes to ensure compliance with applicable laws and regulations• Reviewing KBR’s health, safety and sustainable development performance to determine consistency with policies and goals• Reviewing and providing input to KBR on the management of current and emerging health, safety and sustainable development issues• Overseeing KBR’s activities in managing our major risk exposures within the health, safety and sustainable development areas• Reviewing KBR’s political and charitable contributions, as well as any trade organization memberships

44 45GRI Indicator

GRI Indicator Description

2013 2012 2011

2.6 Nature of ownership and legal form. KBR, Inc. was incorporated in Delaware on March 21, 2006, prior to an exchange-offer transaction that separated us from our former parent, Halliburton Company. This process was completed on April 5, 2007. We trace our history and culture to two businesses, the M.W. Kellogg Company (Kellogg) and Brown & Root, Inc. (Brown & Root). Kellogg dates back to a pipe fabrication business, which was founded in New York in 1901 and has been creating technology for petroleum refining and petrochemical processing since 1919. Brown & Root was founded in Houston, Texas, in 1919 and built the world’s first offshore platform in 1947. Brown & Root was acquired by Halliburton in 1962, and Kellogg was acquired by Halliburton in 1998 through its merger with Dresser Industries.

2.7 Markets served (including geographic breakdown, sectors served, and types of customers/beneficiaries).

Our business strategy is to create shareholder value by providing our customers with differentiated capital project delivery and services across the entire engineering, construction and operations project lifecycle, as a vertically integrated global contractor. We execute our business strategy on a global scale to deliver consistent results anywhere in the world. An essential feature of our global strategy is to establish local operations in market geographies where demand for our services is expected to grow. Our core skills are conceptual design, front-end engineering design (FEED), engineering, project management, procurement, construction, construction management, logistics, commissioning, operations and maintenance. We provide services to a diverse customer base, including international and national oil and gas companies, independent refiners, petrochemical producers, fertilizer producers, and domestic and foreign governments. A considerable percentage of revenue is generated from transactions with the Chevron Corporation (“Chevron”) primarily from our Hydrocarbons business group and the U.S. Government from our IGP business group. For more information, please view our Annual Report.

2.8 Scale of the reporting organization KBR employs more than 27,000 people worldwide in locations that include the Americas, Australia, Africa, Europe, Asia and the Middle East. We deliver a wide range of services supporting the energy, hydrocarbons, power, industrial, civil infrastructure, minerals, government services and commercial services. For more information, please view our Annual Report.

2.9 Significant changes during the reporting period regarding size, structure, or ownership including: • The location of, or changes in operations, including facility openings, closings, and expansions; and • Changes in the share capital structure and other capital formation, maintenance, and alteration operations (for private sector organizations).

In November 2012, the joint venture in which we hold a 50 percent interest sold the office building where we lease office space for our corporate headquarters and business unit offices in Houston, Texas, for $175 million. Since we will continue to lease the office building from the new owner under essentially the same lease terms, the $44 million pre-tax gain on the sale will be deferred and amortized using the straight-line method over the remaining term of the lease, which expires in 2030. In November 2012, we closed on the sale of our former headquarters campus located at 4100 Clinton Drive in Houston, Texas, for approximately $42 million in cash. The sale resulted in a $27 million pre-tax gain on disposal of assets in operating income in our consolidated statements of income. On December 31, 2010, we obtained control of the remaining 44.94 percent interest in our M.W. Kellogg Limited (“MWKL”) consolidated joint venture previously held by JGC Corporation. MWKL is located in the U.K. and provides EPC services primarily for LNG, GTL and onshore oil and gas projects. MWKL will continue to support our LNG and other hydrocarbons projects. On December 21, 2010, we completed the acquisition of 100 percent of the outstanding common shares of ENI Holdings, Inc. (“ENI”). ENI is the parent to the Roberts & Schaefer Company (“R&S”), a privately held EPC services company for material handling systems. Headquartered in Chicago, Illinois, R&S provides services and associated processing infrastructure to customers in the mining and minerals, power, industrial, refining, aggregates, and precious and base metals industries. ENI and its acquired businesses have been integrated into our IGP business group. On December 6, 2012, ENI Holdings, LLC, filed a lawsuit in Delaware Chancery Court alleging that KBR is wrongfully withholding the escrowed holdback. On January 25, 2013, we filed an answer denying the wrongful withholding allegation. In addition, we filed a counterclaim for indemnity and fraud under the terms of the Stock Purchase Agreement. As of December 31, 2012, the escrowed holdback amount was $25 million.

2.10 Awards received in the reporting period.

2013, CareerBliss – 4th Happiest Company in America 2013, Washington Business Journal - One of Washington’s 50 Best Places to Work 2012, Washington Business Journal – 1st Best Places to Work 2012, Newsweek Green Rankings – 4th in Industrial Goods and 101/500 in top publicly traded companies 2011, Newsweek Green Rankings – 9th in Capital Goods and 88/500 in top publicly traded companies 2013, Engineeering News-Record (ENR) Green Contractor Rankings – 37/100 2012, ENR Green Contractor Rankings – 32/100 2011, ENR Green Contractor Rankings – 39/100 2012, Gulf Coast Regional Blood Center Corporation of the Year Please view the Awards section for more information.

3.1 Date of most recent previous report (if any).

KBR's inaugural 2007-2010 Sustainability Report was published in 2011.

3.2 Reporting cycle (annual, biennial, etc.) KBR currently publishes a Sustainability Report every three years.

3.3 Contact point for questions regarding the report or its contents.

For questions regarding this Sustainability Report, please contact us at investors@kbr.com.

3.5 Process for defining report content Since KBR has operational control of our owned facilities, KBR determined to include owned office data and exclude leased facility data in this report. The report represents emissions covered within KBR's corporate boundary and excludes emissions produced at client sites. This report includes information contained in our 2011-2013 Annual Reports, including Form 10-K and Annual Proxy Statements. KBR prepared this report under the direction of KBR’s Sustainable Development Committee, which assessed and determined the prioritization of report data. KBR’s Sustainable Development Committee has executive management representation from Legal; Health, Safety & Environment (HSE); Corporate Communications; Corporate Giving; Commissioning & Startup; Operational Excellence; Operations-Construction; Operations-Engineering; Infrastructure; Procurement; Real Estate Services; and KBR Building Group.

3.6 Boundary of the report (e.g., countries, divisions, subsidiaries, leased facilities, joint ventures, suppliers). See GRI Boundary Protocol for further guidance.

This Sustainability Report includes KBR's global operations across all divisions and subsidiaries. KBR facility data includes owned facilities and excludes leased facilities. Safety data in the report includes subcontractors and joint ventures.

3.7 "State any specific limitations on the scope or boundary of the report. If boundary and scope do not address the full range of material economic, environmental, and social impacts of the organization, state the strategy and projected timeline for providing complete coverage."

KBR is currently evaluating the inclusion of leased facility data in future reports.

3.8 Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations, and other entities that can significantly affect comparability from period to period and/or between organizations.

KBR safety data provided in this report includes subcontractors and joint ventures. KBR facility data includes KBR-owned facilities, since KBR has operational control of these facilities.

GRI IndicatorGRI Indicator Description

2013 2012 2011

4.7 Process for determining the composition, qualifications, and expertise of the members of the highest governance body and our committees,including any consideration of gender and other indicators of diversity.

The Board is responsible for filling our vacancies. The Board has delegated to the NCG Committee the duty of selecting and recommending prospective nominees to the Board for approval. The NCG Committee considers suggestions of candidates for Board membership made by current Committee and Board members, KBR management and stockholders. The Committee may also retain an independent executive search firm to identify candidates for consideration. The NCG Committee will also consider candidates nominated by the stockholders, in accordance with KBR’s bylaws. A stockholder who wishes to recommend a prospective candidate should notify KBR’s Secretary. When the NCG Committee identifies a prospective candidate, the Committee determines whether it will carry out a full evalua-tion of the candidate. This determination is based on the information provided to the Committee by the person recommending the prospective candidate and the Committee’s knowledge of the candidate. This information may be supplemented by inquiries to the person who made the recommendation or to others. The preliminary determination is based on the need for additional Board members to fill vacancies or to expand the size of the Board, and the likelihood that the candidate will meet the Board membership criteria listed above. The NCG Committee will determine, after discussion with the Chairman of the Board and other Board members, whether a candidate should continue to be considered as a potential nominee. If a candidate warrants additional consideration, the Committee may request an independent executive search firm to gather additional information about the candidate’s background, experience and reputation, and to report our findings to the Committee. The NCG Committee then evaluates the candidate and determines whether to interview the candidate. Such an interview would be carried out by one or more members of the NCG Committee and others as appropriate. Once the evaluation and interview are completed, the NCG Committee recommends to the Board which candidates should be nominated. The Board makes a determination of nominees after review of the recommendation and the Committee’s report. Candidates nominated for election or re-election to the Board should possess the following qualifications: • Personal characteristics: - Highest personal and professional ethics, integrity and values - An inquiring and independent mind - Practical wisdom and mature judgment • Broad training and experience at the policy-making level in business, government, education or technology • Expertise that is useful to KBR and complementary to the background and experience of other Board members, so that an optimum balance of members on the Board can be achieved and maintained • Willingness to devote the required amount of time to carrying out the duties and responsibilities of Board membership • Commitment to serve on the Board for several years to develop knowledge about KBR’s principal operations • Willingness to represent the best interests of all stockholders and objectively appraise management performance • Involvement only in activities or interests that do not create a conflict with the director’s responsibilities to KBR and our stockholders The NCG Committee is responsible for assessing the appropriate mix of skills and characteristics required of Board members in the context of the needs of the Board at a given point in time and shall periodically review and update the criteria. Diversity in personal background, race, gender, age and nationality for the Board as a whole may be taken into account in considering individual candidates, but KBR does not have a policy with regard to any particular aspect of diversity of our directors.

4.8 Internally developed statements of mission or values, codes of conduct, and principles relevant to economic, environmental, and social performance and the status of their implementation.

KBR has the following internal Codes of Conduct and policies relevant to KBR’s global economic, environmental and social performance: Code of Business Conduct Policy 3-0001, General Policy Regarding Laws and Business Conduct Code of Business Conduct Policy 3-0002, Equal Employment Opportunity Code of Business Conduct Policy 3-0006, Commercial Bribery Code of Business Conduct Policy 3-0012, Political Contributions and Activities Code of Business Conduct Policy 3-0014, Health, Safety and Environment Code of Business Conduct Policy 3-0016, Harassment Corporate Policy P-GL-KBR-COM-0002, Charitable Contributions Corporate Policy P-GL-KBR-COM-0003, Foreign Community Contributions Corporate Policy P-GL-KBR-QHSE-2001, Quality, Safety, Health and Environment Corporate Policy P-GL-KBR-HR-3000, Educational Assistance Corporate Policy P-GL-KBR-HR-3751, Right to Work and Immigration Corporate Policy P-GL-KBR-HR-3810, Trafficking in Persons Corporate Policy P-GL-KBR-HR-4321, Employee Development Corporate Policy P-GL-KBR-SEC-2102, Preventing Workplace Violence Global Human Rights Policy

4.9 Procedures of the highest governance body for overseeing the organization’s identification and management of economic, environmental, and social performance, including relevant risks and opportunities, and adherence or compliance with internationally agreed standards, codes of conduct, and principles. Include frequency with which the highest governance body assesses sustainability performance.

In addition to the enterprise risk management process described above, the Board also engages in risk oversight in the area of project revenues. The Board also engages in risk oversight through the project approval process, whereby projects reaching a threshold level of expected revenues require Board approval. In reviewing projects, the Board is presented with management’s assessment of a particular project’s cost exposure associated with operations risk, liabilities and funding risks, among others. In this manner, KBR’s Board is engaged in risk oversight at the outset of the largest projects, which could have a material effect on KBR’s operations. The Board is also engaged in risk oversight through regular reports from our Audit Committee. The Audit Committee is charged with reviewing with management the company’s major financial risk exposures, as well as other areas of risk exposure if requested to do so by the Board, and the steps management has taken to monitor and mitigate those exposures. Finally, the CSR Committee has the responsibility for the oversight of KBR’s activities in managing our major risk exposures within the health, safety and sustainable development areas. The CSR Committee receives periodic reports from KBR’s Chief QHSE Officer relating to these risk exposures and the company’s efforts to mitigate those risks. The CSR Committee met twice in 2012 and 2013. KBR has adopted a code of ethics, as defined in Item 406(b) of Regulation S-K. KBR’s code of ethics, known as our Code of Business Conduct, applies to all directors, officers and employees of KBR, including our principal executive officer, principal financial officer, principal accounting officer and controller, and also applies to all employees of KBR and KBR’s agents. KBR has posted our Code of Business Conduct at www.kbr.com.

4.10 Processes for evaluating the highest governance body’s own performance, particularly with respect to economic, environmental, and social performance.

The Board evaluates our own performance on an annual basis, and our performance is evaluated by KBR’s stakeholders by our annual proxy.

4.11 Explanation of whether and how the precautionary approach or principle is addressed by the organization.

KBR acknowledges the principles contained in the United Nations Rio Principles as a general standard for sustainable development concerns worldwide. KBR plays a role in upholding sustainable development by our own actions in the countries in which we do business.

4.12 Externally developed economic, environmental, and social charters, principles, or other initiatives to which the organization subscribes or endorses

While KBR does not currently subscribe to or endorse externally developed economic, environmental and social charters and principles, KBR does follow many of the economic, environmental and social principles and practices.

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4.2 Indicate whether the Chair of the highest governance body is also an executive officer (and, if so, their function within the organization’s management and the reasons for this arrangement).

Since the inception of KBR as an independent public company in April 2007, the Chief Executive Officer (CEO) and President of KBR has also served as the Chairman of the Board. KBR believes that the leadership of our Board is best served by combining the roles of CEO and Chairman. The CEO/Chairman of the Board is responsible to the Board for the overall management and functioning of KBR.

4.3 For organizations that have a unitary board structure, state the number and gender of members of the highest governance body that are independent and/or non-executive members.

The Board is comprised of eight independent/non-executive directors. Of the eight independent/non-executive directors, one is female. The Board is comprised of eight males (89 percent) and one female (11 percent). One member is African-American (11 percent). The age groups are: 50s (22 percent), 60s (56 percent) and 70s (22 percent). The Audit Committee is comprised of four males (100 percent), one of whom is African-American (25 percent). Three members are in their 60s (75 percent) and one is in his 70s (25 percent). The Compensation Committee is comprised of three males (75 percent) and one female (25 percent). One member is in her 50s (25 percent), two members are in their 60s (50 percent) and one member is in his 70s (25 percent). The NCG Committee is currently comprised of four males (100 percent). Two members are in their 60s (50 percent) and two members are in their 70s (50 percent). The CSR Committee is currently comprised of three males (75 percent) and one female (25 percent). One member is African-American (25 percent). One member is in her 50s (25 percent) and three members are in their 60s (75 percent).

4.4 Mechanisms for shareholders and employees to provide ecommendations or direction to the highest governance body.

To foster better communication with KBR’s stockholders, KBR established a process for stockholders and other interested parties to communicate with the Audit Committee and the Board. The process was approved by the Board and our Audit Committee, and is designed to meet the requirements of the NYSE and the SEC. Stockholders and other interested parties may communicate with the Board or the independent/non-executive directors via mail (Board of Directors c/o Director of Business Conduct, KBR, Inc., P.O. Box 3406, Houston, Texas 77253-3406), telephone (1.855.231.7512 (toll-free from the U.S. or Canada) or 1.503.619.1884 (calling collect from any other country), or email (fhoukbrbod@kbr.com). Information regarding these methods of communication is available at www.kbr.com under “Corporate Governance.” KBR’s Director of Business Conduct reviews all communications directed to the Audit Committee and the Board. The Chairman of the Audit Committee is promptly notified of any significant communication involving accounting, internal accounting controls, auditing matters or any other significant communications. Communications addressed to a named Board Director are promptly sent to the director. Communications directed to the independent/non-executive directors are promptly sent to the Lead Director. A report summarizing the significant communications is sent to each director quarterly and copies of communications are available for review by any director, except that those designated for the independent/non-executive directors are not available to executive directors. The process has been approved by both the Audit Committee and the Board, and is designed to meet the requirements of the NYSE and the SEC. Concerns may be reported anonymously or confidentially. Stockholders may present a proposal to be considered for inclusion in KBR’s proxy material for our Annual Meeting of Stockhold-ers, to be held in 2014, by submitting the proposal in writing to KBR’s Corporate Secretary at 601 Jefferson Street, Suite 3400, Houston, Texas 77002. KBR must receive proposals not later than the 120th day prior to the date on which KBR estimates that it will send our materials for our 2014 Annual Meeting of Stockholders. Proposals submitted for inclusion in KBR’s proxy materials must comply with Rule 14a-8 under the Exchange Act. In order for stockholder proposals to have been properly submitted for presentation at KBR’s Annual Meeting of Stockholders, KBR must have received notice of the proposal not earlier than January 15, 2014, nor later than February 14, 2014 (the 120th and 90th days, respectively, prior to May 15, 2014, the intended date of the 2014 Annual Meeting of Stockholders). Proposals must comply with Article I, Section 9 of KBR’s Bylaws. A nomination or proposal that does not comply with the above procedures will be disregarded. Compliance with the above procedures does not require KBR to include the proposed nominee or business in KBR’s proxy solicitation materials.

4.5 Linkage between compensation for members of the highest governance body, senior managers, and executives (including departure arrangements), and the organization’s performance (including social and environmental performance).

KBR believes in providing a strong link between our senior executives’ compensation and our company’s performance. The payouts in our CEO’s, CFO’s and the next three highest-paid senior executives’ short- and long-term incentive compensation have been consistent with the our company’s stock performance over the one- and three-year periods in comparison to our Engineering & Construction Peer Group’s stock performance. A significant portion of our senior executives’ compensation in 2012 was performance-based. For example, 81percent of our CEO’s compensation was performance-based. Performance-based compensation is comprised of short- and long-term incentive compensation. The short-term (annual) incentive (STI) plans reward executives and senior managers for improving financial results for KBR stockholders and provide a means to connect cash compensation directly to KBR’s short-term performance. Payouts under the STI plans are based on the achievement level of several performance metrics including: KBR earnings per share, KBR or KBR business group/unit income, KBR or KBR business group/unit job income sold, KBR or KBR business group/unit cash flow from operations, and KBR or KBR business group/unit recordable incident rate. The long-term incentive (LTI) plan rewards executives and senior managers for consistent achievement of value creation and operating performance goals. LTI awards are delivered through a combination of cash-based performance awards and equity-based restricted stock units and stock options. The Compensation Committee concluded that this mix was consistent with KBR’s pay for performance objectives. Specifically, the stock options and restricted stock units (i) are directly tied to KBR’s stock price performance and, therefore, directly to stockholder value and (ii) provide a significant incentive for recipients to remain with KBR. The performance cash awards encourages executives and senior management to improve long-term returns and reward performance relative to industry peers.

4.6 Processes in place for the highest governance body to ensure conflicts of interest are avoided.

At this time, all of our directors are independent, as set forth in KBR’s Corporate Governance Guidelines and outlined below, except our Chairman, President and Chief Executive Officer, Mr. Utt, who does not qualify as an independent director. A director will be considered independent under KBR’s Corporate Governance Guidelines if he or she: • Has no material relationship with KBR • Has not been employed by us or any affiliate of ours during the preceding three years, and no member of the director’s immediate family has been employed as an executive officer of ours or any of our affiliates during the preceding three years • Has not received, and does not have an immediate family member who has received, during any twelve-month period within the preceding three years, more than $100,000 in direct compensation from KBR, other than director’s fees, committee fees or pension or deferred compensation for prior service • Is not a partner or an employee of KBR’s independent auditor, and was not during the past three calendar years a partner or employee of KBR’s independent auditor who personally worked on KBR’s audit • Does not have an immediate family member who is a partner of KBR’s independent auditor or an employee of KBR’s independent auditor who participates in that firm’s audit, assurance or tax compliance (but not tax planning) practice or was during the past three calendar years a partner or employee of KBR’s independent auditor who personally worked on KBR’s audit • Is not a current employee and does not have an immediate family member who is a current executive officer of any company that has made payments to, or received payments from, KBR or any of our affiliates in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million or 2 percent of our or such other company’s consolidated gross revenues • Has not (and has not had a family member who) within the preceding three years served as an executive officer with a company for which a KBR executive served on our compensation committee The definition of independence and compliance with this policy will be reviewed periodically by the NCG Committee. All directors complete independence questionnaires at least annually, and our Board makes determinations of the independence of our members under the listing standards of the NYSE and the SEC requirements for Audit Committee members.

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4.14 List of stakeholder groups engaged by the organization.

KBR engages with our stakeholder groups, including shareholders, clients, communities, nonprofits, governments, suppliers and employees.

4.15 Basis for identification and selection of stakeholders with whom to engage.

KBR's Board of Directors has overall responsibility for stakeholders with whom KBR engages.

4.16 Approaches to stakeholder engagement, including frequency of engagement by type and by stakeholder group.

KBR engages with shareholders through daily phone and corporate office meetings, quarterly earnings calls, analyst/investors days and industry conferences. KBR engages with nonprofits through industry organizations and committees, and through KBR’s annual social impact assessment, which KBR uses to evaluate our social and environmental investments. KBR North American Government and Logistics (NAGL) performs client and customer surveys. Client surveys are performed quarterly and customer surveys are performed daily for each critical service area via customer feedback. The survey results are consolidated into metrics for monthly management reviews. Actions are taken based on cause trends from the monthly metrics at the project level and are documented into KBR’s web-based data management for quality. In 2013, KBR conducted a company-wide employee engagement survey to help us ensure that we provide an environment that encourages employees to achieve outstanding and innovative performance.

4.17 Key topics and concerns that have been raised through stakeholder engagement, and how the organization has responded to those key topics and concerns, including through its reporting.

The results from our 2013 employee engagement survey indicate that KBR’s employees’ key topics and concerns are pay and benefits, confidence in leadership, entrepreneurial spirit and career development. KBR’s leadership team is committed to responding to our employees’ concerns and is currently evaluating ways to address them. In some cases, KBR may create programs and processes to increase leadership visibility, provide clarity on strategy and total rewards, improve opportunities for career development, reduce unnecessary bureaucracy and enhance pride and engagement. KBR continues to build the best environment for our most importance resource — our employees.

EC1 Direct economic value generated and distributed, including revenues, operating costs, employee compensation, donations and other community investments, retained earnings, and payments to capital providers and governments.

In KBR’s Consolidated Statements of Incomes from 2013, Net Income Attrib-utable to KBR was $229,000,000 USD. Services Revenue was $7,283,000,000 USD. Cost of Services was $6,702,000,000 USD. General and Administrative was $249,000,000 USD. Net Interest Expense was $5,000,000 USD. Other Non-Operating Expense was $3,000,000 USD. Provision for Income Taxes was $136,000,000 USD. In KBR’s Consolidated Balance Sheets, Retained Earnings were $1,902,000,000 USD. Please view KBR 2013 Annual Report for more information.

In KBR's Consolidated Statements of Incomes from 2012, Net Income Attrib-utable to KBR was $144,000,000 USD. Services Revenue was $7,770,000,000 USD. Cost of Services was $7,252,000,000 USD. General and Administrative was $222,000,000 USD. Net Interest Expense was $7,000,000 USD. Other Non-Operating Expense was $2,000,000 USD. Provision for Income Taxes was $86,000,000 USD. In KBR’s Consolidated Balance Sheets, Retained Earnings were $1,709,000,000 USD. Please view KBR 2012 Annual Report for more information.

In KBR's Consolidated Statements of Incomes from 2011, Net Income Attribut-able to KBR was $480,000,000 USD. Services Revenue was $9,103,000,000 USD. Cost of Services was $8,463,000,000 USD. General and Administrative was $214,000,000 USD. Net Interest Expense was $18,000,000 USD. Other Non-Operating Expense was $0 USD. Provision for Income Taxes was $32,000,000 USD. In KBR’s Consolidated Balance Sheets, Retained Earnings were $1,607,000,000 USD. Please view KBR 2011 Annual Report for more information.

EC2 Financial implications and other risks and opportunities for the organization’s activities due to climate change.

Existing or pending climate change legislation, regulations, international treaties or accords are not expected to have a material direct effect on our business or the markets that we serve, nor on our results of operations or financial position. However, climate change legislation could have a direct effect on our customers or suppliers, which could have an indirect effect on our business. For example, our commodity-based markets depend on the level of activity of mineral and oil and gas companies, and existing or future laws, regulations, treaties or international agreements related to climate change, including incentives to conserve energy or use alternative energy sources, could have an indirect impact on our business if such laws, regulations, treaties or international agreements reduce the worldwide demand for minerals, oil and natural gas. We will continue to monitor developments in this area.

EC3 Coverage of the organization’s defined benefit plan obligations.

KBR sponsors some defined benefit plans that have been established in various countries in accordance with legal requirements and customs. The benefits offered by these plans define an amount of pension benefit to be provided, usually as a function of age, years of service or compensation. The measurement date for all defined benefit plans is December 31. Funding requirements for each plan are determined based on the local laws of the country where such plan resides. In certain countries, the funding requirements are mandatory while in other countries they are discretionary. For additional information regarding KBR’s defined benefit plans, please view KBR’s Annual Report.

EC4 Significant financial assistance received from government

KBR has not received financial assistance from any government.

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4.13 Memberships in associations (such as industry associations) and/or national/international advocacy organizations

KBR and its employees participated in the following during 2011-2013: • Aerospace, Defence and Security Association • American Chamber of Commerce – Australia, Azerbaijan, Brazil • American Council of Engineering Companies of Texas (ACEC Texas) • American Fuel & Petrochemical Manufacturers (AFPM) • American Immigrations Lawyers Association (AILA) • American Institute of Architects • American Institute of Certified Public Accountants (AICPA) • American Institute of Chemical Engineers (AIChE) • American Institute of CPA’s • American Petroleum Institute (API) • American Society of Civil Engineers • American Society of Mechanical Engineers (ASME) • American Welding Society (AWS) • ASIS • Associated Builders & Contractors National Diversity Committee • Association for Financial Professionals • Association of Corporate Travel Executives (ACTE) • Association of General Contractors (AGC) • Association of the United States Army (AUSA) • Australian Petroleum Production and Exploration Association (APPEA) • Bayou Preservation Association • Bi-lateral U.S. Arab Chamber of Commerce • BIPAC • Birmingham Business Alliance • British Chemical Engineering Contractors Association (BCECA) • British Safety Council • Business Council of Alabama • Business Council of International Understanding • Business Roundtable – Golden Triangle, Houston • CAPS Research • Center for Houston’s Future • Chamber of Commerce • Committee for Economic Development of Australia • Construction Industry Institute • Construction Management Association of America (CMAA) • Consult Australia – National Sustainability Roundtable • Design Build Institute of America (DBIA) • Energy Institute • Engineering and Construction Contracting Association (ECC) • Engineering and Construction Risk Institute (ECRI) • Engineering Construction Industry Training Board (ECITB) • Engineers Australia - Society for Sustainability and Environmental Engineering • Gas Processors Association Ltd. • Gasification Technologies Council (GTC) • Global Business Travel Association (GBTA) • Golden Training Business Round Table • Greater Houston Partnership • Gulf Coast Power Association • Gulf Petrochemicals and Chemicals Association (GPCA) • Houston Business Roundtable • Houston Minority Supplier Development Council • Institute for Supply Management • Institute of Electrical and Electronics Engineers (IEEE) • Institute of Materials, Materials and Mining • Institute of Measurement and Control • Institution of Engineering and Technology (IET) • Institution of Structural Engineers • International Facility Management Association (IFMA) • IT Service Management Forum (ITSMF) • Manufacture Alabama • Manufacturers Alliance for Productivity and Innovation (MAPI) • National Association of Industrial & Office Product (NAIOP) Northern Virginia • National Association of Minority Contractors • National Contract Management Association (NCMA) • National Defense Industrial Association (NDIA) • National Foreign Trade Council • National Petroleum Council • National Association of Minority Contractors • Partners for Environmental Progress • Petroleum Federation of India (PetroFed) • Process Industry Practices • Procurement Executives Group • Professional Services Council • Program Advisory Committee (PAC) Kitimat Valley Institute (KVI) • Project Management Institute (PMI) • Renewable UK • Restore America’s Estuaries • Roads Australia – Sustainability Chapter • Safety Institute of Australia • Simulation Australia • Society for Human Resource Management (SHRM)

KBR and our employees participated in the following during 2011-2013: • Aerospace, Defence and Security Association • American Chamber of Commerce – Australia, Azerbaijan, Brazil • American Council of Engineering Companies of Texas (ACEC Texas) • American Fuel & Petrochemical Manufacturers (AFPM) • American Immigrations Lawyers Association (AILA) • American Institute of Architects • American Institute of Certified Public Accountants (AICPA) • American Institute of Chemical Engineers (AIChE) • American Institute of CPAs • American Petroleum Institute (API) • American Society of Civil Engineers • American Society of Mechanical Engineers (ASME) • American Welding Society (AWS) • ASIS • Associated Builders & Contractors National Diversity Committee • Association for Financial Professionals • Association of Corporate Travel Executives (ACTE) • Association of General Contractors (AGC) • Association of the United States Army (AUSA) • Australian Petroleum Production and Exploration Association (APPEA) • Bayou Preservation Association • Bilateral U.S. Arab Chamber of Commerce • BIPAC • Birmingham Business Alliance • British Chemical Engineering Contractors Association (BCECA) • British Safety Council • Business Council of Alabama • Business Council of International Understanding • Business Roundtable – Golden Triangle, Houston • CAPS Research • Center for Houston’s Future • Chamber of Commerce • Committee for Economic Development of Australia • Construction Industry Institute • Construction Management Association of America (CMAA) • Consult Australia – National Sustainability Roundtable • Design Build Institute of America (DBIA) • Energy Institute • Engineering and Construction Contracting Association (ECC) • Engineering and Construction Risk Institute (ECRI) • Engineering Construction Industry Training Board (ECITB) • Engineers Australia - Society for Sustainability and Environmental Engineering • Gas Processors Association Ltd. • Gasification Technologies Council (GTC) • Global Business Travel Association (GBTA) • Golden Training Business Round Table • Greater Houston Partnership • Gulf Coast Power Association • Gulf Petrochemicals and Chemicals Association (GPCA) • Houston Business Roundtable • Houston Minority Supplier Development Council • Institute for Supply Management • Institute of Electrical and Electronics Engineers (IEEE) • Institute of Materials, Materials and Mining • Institute of Measurement and Control • Institution of Engineering and Technology (IET) • Institution of Structural Engineers • International Facility Management Association (IFMA) • IT Service Management Forum (ITSMF) • Manufacture Alabama • Manufacturers Alliance for Productivity and Innovation (MAPI) • National Association of Industrial & Office Product (NAIOP) Northern Virginia • National Association of Minority Contractors • National Contract Management Association (NCMA) • National Defense Industrial Association (NDIA) • National Foreign Trade Council • National Petroleum Council • National Association of Minority Contractors • Partners for Environmental Progress • Petroleum Federation of India (PetroFed) • Process Industry Practices • Procurement Executives Group • Professional Services Council • Program Advisory Committee (PAC) Kitimat Valley Institute (KVI) • Project Management Institute (PMI) • Renewable UK • Restore America’s Estuaries • Roads Australia – Sustainability Chapter • Safety Institute of Australia • Simulation Australia • Society for Human Resource Management (SHRM) • Society of American Military Engineers (SAME) • Society of Naval Architects and Marine Engineers (SNAME) • Society of Women Engineers (SWE) • South African Institution of Chemical Engineers • Subsea Energy Australia • Technical Association of Pulp and Paper Industry (TAPPI) • U.S. Chamber of Commerce – Iraq Business Initiative • U.S.-China Energy Cooperation Program • U.S. Green Building Council (USGBC) • Water Services Association of Australia • Women Business Enterprise Alliance • Women in Defence • Women’s Energy Network

Between 2011 and 2013 KBR gave a combined $7,489,762 USD in community investments which includes company matching and combined regional areas. Employees gave a total of $2,677,898 USD.

GRI IndicatorGRI Indicator Description

2013 2012 2011

EC9 Understanding and describing significant indirect economic impacts, including the extent of impacts.

Our rate of growth and the success of our business depend upon our ability to attract, develop and retain a sufficient number of affordable trained engineers and other skilled workers, either through direct hire or the acquisition of other firms employing such professionals. The market for these professionals is competitive. If we are unable to attract and retain a sufficient number of skilled personnel, our ability to pursue projects may be adversely affected, the cost of executing our existing and future projects may increase, and our financial performance may decline. A significant portion of our revenue is derived from foreign operations, which exposes us to risks inherent in doing business in each of the countries where we transact business. The occurrence of any of the risks described below could have a material adverse effect on our business operations and financial performance. With respect to any particular country, these risks may include but are not limited to: • Expropriation and nationalization of our assets in that country • Political and economic instability • Civil unrest, acts of terrorism, force majeure, war or other armed conflict • Currency fluctuations, devaluations and conversion restrictions • Confiscatory taxation or other adverse tax policies • Governmental activities or judicial actions that limit or disrupt markets, restrict payments, limit the movement of funds, result in the deprivation of contract rights or result in the inability for us to obtain or retain licenses required for operation. Due to the unsettled political conditions in many oil-producing countries and other countries where we provide governmental logistical support, our financial performance is subject to the adverse consequences of war, the effects of terrorism, civil unrest, strikes, currency controls and governmental actions. Our operations are conducted in areas that have significant amounts of political risk. In addition, military action or continued unrest in the Middle East could impact the supply and price of oil and gas, disrupt our operations in the region and elsewhere, and increase our security costs worldwide. Some of our services are performed in high-risk locations, such as Iraq, Afghanistan, Nigeria, Algeria, Egypt and Saudi Arabia, where the country or location and surrounding area is suffering from political, social or economic issues, war or civil unrest. In those locations where we have employees or operations, we have and may continue to incur substantial costs to maintain the safety of our personnel. Despite these precautions, we have suffered the loss of employees and contractors, which could expose us to claims and litigation. In the future, the safety of our personnel in these and other locations may continue to be at risk, exposing us to the potential loss of additional employees and contractors. For more information, please view our Annual Report.

EN2 Percentage of materials used that are recycled input materials.

In 2013, the following is KBR’s approximate weight of paper supplied to our owned facilities: Birmingham: 36,904 pounds Leatherhead: 22,531 pounds Greenford: 7,143 pounds

In 2012, the following is KBR’s approximate weight of paper supplied to our owned facilities: Birmingham: 47,886 pounds Leatherhead: 24,185 pounds Greenford: 13,648 pounds

In 2011, the following is KBR’s approximate weight of paper supplied to our owned facilities: Birmingham: 45,112 pounds Leatherhead: 31,854 pounds Greenford: 14,330 pounds

At KBR’s facilities, paper is supplied through Xerox, which uses a chain-of-custody system with its suppliers and is certified with the Program for the Endorsement of Forest Certification, Forest Stewardship Council and the Sustainable Forestry Initiative. When compared to 2011, KBR reduced our paper supply by 22 percent in 2013.

EN3 Direct energy consumption by primary energy source.

In 2013, the following is KBR's natural gas consumption at our owned facilities: Birmingham = 0 Leatherhead = 835 tCO2e Greenford = 328 tCO2e

In 2012, the following is KBR's natural gas consumption at our owned facilities: Birmingham = 0 Leatherhead = 740 tCO2e Greenford = 281 tCO2e

In 2011, the following is KBR's natural gas consumption at our owned facilities: Birmingham = 0 Leatherhead = 808 tCO2e Greenford = 246 tCO2e

To maintain KBR’s ISO 14001 certification, Environmental Aspect & Impact Registers are completed and maintained for all global offices. Uniformly throughout the global offices, KBR implements and sustains several initiatives to reduce our potential global impacts.

In an effort to reduce releases to the atmosphere from combustion engines, KBR implemented several ways to reduce energy consumption while traveling to and from work. KBR encourages ridesharing through carpools, vanpools and the use of KBR-sponsored metro ridership program. The Monterrey office implemented a campaign to foster a carpool program. The Leatherhead office provides racking and motor bike parking to promote cycling. To promote walking, running and cycling to work, the Leatherhead office provides a shower facility for employees.

EN4 Indirect energy consumption by primary source.

In 2013, the following is KBR’s electricity consumption at our owned facilities: Birmingham = 2,315 tCO2e Leatherhead = 3,493 tCO2e Greenford = 1,743 tCO2e

In 2012, the following is KBR's electricity consumption at our owned facilities: Birmingham = 2,448 tCO2e Leatherhead = 3,443 tCO2e Greenford = 2,121 tCO2e

In 2011, the following is KBR's electricity consumption at our owned facilities: Birmingham = 2,802 tCO2e Leatherhead = 3,662 tCO2e Greenford = 2,372 tCO2e

EN5 Energy saved due to conservation and efficiency improvements.

A number of factors and equipment improvements have resulted in the reduction of energy usage for the London Operating Centre (LOC). The introduction of an energy management plan and regular energy meetings within Real Estate Services resulted in a more structured approach. A bespoke monitoring and targeting tool allows KBR to download half-hourly electricity data and input gas readings to enable KBR to better analyze the usage. Two technical members of our Real Estate Services team have undergone training on remote learning courses for the Energy Institutes Certificate in Energy Management, resulting in a better understat-ing of energy, auditing and cost analysis. Building Management Systems controls (BMS) have been reviewed, resulting in improved use, timed on/off functions, temperature settings and set points. Following cost analysis and payback, new boiler controls have been fitted to seven boilers at our Leatherhead facility. Up to 1,000 50-watt dichroic lamps have been replaced by 10-watt LED lamps. Car park lighting has been replaced with more efficient motion-detection lights. In 2013, our Birmingham office scheduled a capital project of replacing all of the building lighting with new electronic ballasts and T-8 energy-efficient bulbs. The estimated cost savings in energy consumption should be approximately 30 percent to 35 percent.

EN6 Initiatives to provide energy-efficient or renewable energy based products and services, and reductions in energy requirements as a result of these initiatives.

KBR communicates our expectations to subcontractors for minimizing and reducing harmful environmental impacts. In our Supplier Registration process, we have a Green Information tab which suppliers are required to complete to be able to be considered as a vendor. This information is available at www.kbr.com under Supplier Relations. KBR is signatory to the U.K. Ministry of Defence Sustainable Procurement Charter, an initiative committing the company to educate suppliers and share best practices, ensure an informed decision-making process and develop procurement performance measurement criteria. For KBR's U.S. government contracts and as requested by our clients, KBR follows Executive Orders 13423 and 13514. The Executive Orders require KBR to procure recycled products; energy- and water-efficient products, including WaterSense and EnergyStar; alternate fuels and alternate-fuel vehicles, including plug-in hybrid vehicles; bio-based products; non-ozone depleting products; and other environmentally preferred products and services. For the Executive Orders, KBR uses low/non-toxic and non-hazardous materials, minimizes pollution and waste, and uses our existing Environmental Management System.

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EC5 Range of ratios of standard entry level wage by gender compared to local minimum wage at significant locations of operation.

Compensation Philosophy: • Attract, reward and retain high-performing employees • Target base pay at the 50th percentile of the competitive market • Link performance to pay • Be competitive within business and geographic markets • Allow for changing business needs Factors that influence pay: • People, Performance and Results (PPR) rating • Job Market Pricing for similar jobs in other companies • Relative value of a job compared to other internal jobs • Job-related knowledge, skills and abilities • The annual merit budget for a specific location and KBR’s overall financial performance Timing of Pay Increase(s): • On-cycle adjustments - Annual Merit Review • Off-cycle adjustments - Movements in market rates • Promotion Global Job Classification and Salary Ranges • The process of job evaluation begins with the collection of job duties and responsibilities. This activity is aided by a job description questionnaire that is completed each time a job changes or the need to create a new job classification arises. The completion of the job evaluation process will result in a job description specifying a job classification’s duties and responsibilities in the organization. • Jobs are also evaluated on several compensable factors, such as diversity of tasks, scope of accountability, autonomy and leadership. This process assists in determining the comparative value of one job classification to another. • Job classifications of the same or similar nature are placed into salary ranges. There is a minimum, mid-point and maximum for every salary range. Mid-points are set using market competitive levels. The range for an individual job should fall between 20 percent below to 20 percent above a job’s market price. Job Market Pricing • The process of determining a competitive rate of pay for jobs is called Job Market Pricing. We want to ensure that our jobs are competitively compensated relative to comparable positions in the external marketplace. KBR ensures fairness in pay practices and confidentiality. • KBR is committed to provide competitive pay for our employees based on the nature of the job, and strives to be aligned with industry pay practices and in compliance with the legal regulations in each location where we operate. • Our payroll reporting systems are designed to enforce rigorous privacy and confidentiality in the handling of salary data. Access to pay-related information is limited and compensation is bound by strict authorization guidelines. Salary survey participation follows accepted professional standards at all times. Violations of the Code of Business Conduct are not tolerated.

EC6 Policy, practices, and proportion of spending on locally-based suppliers at significant locations of operation.

For 2013, KBR’s total spend with qualified Diverse Suppliers was $16,034,493 USD.

For 2012, KBR's total spend with qualified Diverse Suppliers was $35,173,943 USD.

For 2011, KBR's total spend with qualified Diverse Suppliers was $49,612,397 USD.

KBR’s Supplier Diversity program is committed to seeking suppliers and contractors who add value to our company and to the customers we serve. As part of this commitment, KBR continually seeks to provide opportunities for minority- and women-owned businesses that offer goods, subcontracting services and professional services on a competitive basis. In addition, KBR strives to promote the economic growth of minority- and women-owned businesses by offering technical assistance and counseling/mentoring services, as well as sponsoring events that support the development of such business. KBR ensures that these supplier development goals are met by participating in industry-specific groups to create opportunities for meeting and networking with qualified diverse businesses and discussing potential opportunities within KBR. KBR also collaborates with other global corporations for best practices sharing and sponsorship of diverse networking events.

EC7 Procedures for local hiring and proportion of senior management hired from the local community at locations of significant operation.

KBR supports hiring workers from the local communities where we operate. As a global leader, we are committed to increasing Aboriginal participation across our business. Our teams will build stronger relationships and create increased opportunities for engagement. As our relationships strengthen, we will further demonstrate our commitment of a culturally-inclusive engagement process within the environments in which we work. KBR, through our adherence to the Code of Business Conduct, further undertakes to: • Supports all stakeholders inclusive of traditional owners; Aboriginal communities; and local, state and federal governments and their agencies, in the advancement of Aboriginal people across regions • Identify and champion employment opportunities for Aboriginal people across business units • Promotes a work environment which embraces diversity, free of racial discrimination and harassment • Ensures any learning and development programs supporting Aboriginal engagement are culturally inclusive • Will promote and support community relationships and partnerships for mutual growth and development • The objectives of the Aboriginal participation/engagement procedure are to: - Embed cultural inclusion across our business units - Work with stakeholders to identify, champion and maintain employment and career development opportunities - Identify and champion opportunities for Aboriginal businesses and business development across business units - Establish and maintain effective community relationships and partnerships KBR supports these objectives to deliver meaningful cultural recognition, employment, training and business opportunities for Aboriginal people. We are committed to supporting initiatives and strategies which enable us to be a global leader in Aboriginal engagement. The responsibility of championing our commitment will be through our regional and local leadership teams, with the pivotal point to success through all KBR employees and our contractors.

EC8 Development and impact of infra-structure investments and services provided primarily for public benefit through commercial, inkind, or pro bono engagement.

After KBR completed LOGCAP operations in Iraq, KBR donated $273,853 USD worth of computers to the Iraq Ministry of Education for use in schools. In 2012, KBR donated more than 26,000 pieces of office furniture to Houston-area school districts and charities after phasing out of our Clinton Drive facility.

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2013 2012 2011

EN26 Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation

KBR's Environmental Management System is part of our Integrated Management System. Our Environmental Management System enables us to define the impact of our business on the environment, implement actions demonstrating our acceptance of our responsibility for those impacts, communicate to our employees and subcontractors our expectation of them to minimize and reduce harmful impacts, and carry our environmental accountability into the communities affected by our business. Each of KBR’s offices and projects complete an Environmental Aspect and Impact Register. Environmental Aspects are divided into the following categories: Emissions to Air, Emissions to Water, Releases to Land, Energy Consumption, Use of Raw Materials and Natural Resources, and Waste and By-Products. KBR uses an in-house system of risk management, applied throughout the company, to identify operational risks and opportunities, including those associated with environmental impacts, in a systematic and consistent manner. Integral to our risk management approach is the integration of our Code of Business Conduct elements and procedures. Individual business units have the responsibility to develop and maintain business risk registers for their particular business opportunities and areas. Our business development oversight organization is responsible for operating an internal comprehensive risk control process to assure a high degree of confidence in business practices and investments to our shareholders.

EN28 Monetary value of significant fines and total number of non-monetary sanctions for noncompliance with environmental laws and regulations.

In 2013, KBR did not receive any significant environmental fines and had no non-monetary sanctions for noncompliance with environmental laws and regulations.

In 2012, KBR did not receive any significant environmental fines and had no non-monetary sanctions for noncompliance with environmental laws and regulations.

In 2011, KBR did not receive any significant environmental fines and had no non-monetary sanctions for noncompliance with environmental laws and regulations.

During 2011-2013, KBR has no administrative and/or judicial sanctions for failure to comply with environmental laws and regulations.

LA1 Total workforce by employment type, employment contract, and region, broken down by gender

During 2013, KBR’s total workforce was 27,311. Afghanistan-288; Australia-1,690; Canada-2,379; Iraq-685; Mexico-1,628; Singapore-223; U.K.-1,625; U.S.-13,081; Other-5,712.

During 2012, KBR's total workforce was 27,438. Afghanistan-357; Australia-1,980; Canada-1,586; Iraq-1,579; Mexico-1,886; Singapore-305; U.K.-1,730; U.S.-12,887; Other-5,138.

During 2011, KBR's total workforce was 26,647. Afghanistan-371; Australia-1,780; Canada-808;Iraq-2,507; Mexico-1,662; Singapore-369; U.K.-1,984; U.S.-11,774; Other-5,392.

LA2 Total number and rate of new employee hires and employee turnover by age group, gender, and region.

KBR’s Executive, Technical and Administrative (ETA) voluntary turnover for December 2013 was 13.90 percent (annually weighted)

KBR's Executive, Technical and Administrative (ETA) voluntary turnover for December 2012 was 15.44 percent (annually weighted)

KBR's Executive, Technicial and Administrative (ETA) voluntary turnover for December 2011 was 13.12 percent (annually weighted)

Retention of our staff is key, and we have a continuous learning philosophy to ensure that our people continually develop to their full potential in a challenging and motivating environment. Together with our remuneration and benefits package, our facilities and initiatives are designed to promote employee engagement, enjoyment and well-being, serve to gain loyalty and aid retention. Retention strategies include short- and long-term incentive plans, and internal and external learning and development programs for technical and soft skills, such as our online university, employee engagement surveys, talent reviews, PPR (People, Perfor-mance, Results) reviews, career mentorships and further education sponsorship programs. Our graduate training programs are accredited with all the major institutions, and we are a gold partner of the IChemE. We operate a modern apprenticeship training program for school and college leaders. We have a global leadership development program, lunch and learns, and ad hoc training interventions as may be required. We also operate IMPACT, an organization for new industry entrants with up to seven years of experience for the purposes of professional and leadership development, networking and social opportunities, and volunteerism. This group is company-funded and manages our own budget. We believe that IMPACT is unique in our industry, and successfully guides members through the initial stages of their KBR careers. To encourage longevity of service, engagement and well-being, we encourage a cohesive working environment supported by the following: Employee Assistance Program, health programs, sports and social clubs, company and project social functions, and celebrations. We use a variety of communication channels, including company publications, e-newsletters, town halls, projects news, awards, employment engagement surveys, and employee and manager forums. We keep in touch with our staff that does leave us with a view of them returning in the future with added experience elsewhere, we have a comprehensive exit interview process to highlight any lessons learned. Key to retention and longevity of service to our projects is the work our employees are engaged in. This is at our strongest when the facilities listed above work hand-in-hand with interesting, challenging and motivating work that stretches our staff to reach their full potential.

LA3 Benefits provided to full-time employees that are not provided to temporary or part-time employees, by significant locations of operation.

Benefits provided to full-time employees that are not provided to temporary or part-time employees:

LA4 Percentage of employees covered by collective bargaining agreements

During 2013, 16.7 percent of KBR employees were under collective bargaining agreements.

During 2012, 15.8 percent of KBR employees were under collective bargaining agreements.

During 2011, 13.2 percent of KBR employees were under collective bargaining agreements.

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2013 2012 2011

EN7 Initiatives to reduce indirect energy consumption and reductions achieved.

For 2012, KBR's Greenford and Leatherhead U.K. offices set a 2.5 percent reduction target in greenhouse gas emissions, and a 7.1 percent reduction in greenhouse gases was achieved. KBR's U.K. offices obtained the CRC Energy Efficiency Scheme Accreditation and Carbon Trust Standard. To maintain KBR’s ISO 14001 certification, Environmental Aspect & Impact Registers are completed and maintained for all global offices. Uniformly throughout the global offices, KBR implements and sustains several initiatives to reduce our potential global impacts. Globally, KBR has taken several measures to reduce energy consumption from use of computers, notebooks, printers and plotters, to unnecessary consumption of electricity from leaving electrical appliances on when not use. All office equipment is switched off during night hours, and all printers and plotters are set up with an economy-saver mode. Toolbox and/or HOSAT meetings are held to encourage the reduction of energy use throughout the office locations. Several offices monitor and analyze the data collected from the energy meters to establish where energy consumption can be minimized. To reduce energy consumption, several KBR offices take initiatives to reduce energy waste from inefficient lighting systems. Most offices have zoned lighting with clearly labeled controls so that the staff can work outside regular work hours without switching on lighting for an entire floor. Energy meters are monitored, and data is collected and analyzed. Our Singapore office designed the office layout to use the maximum amount of natural light, and only installs fluorescent tubes for an additional energy savings.

EN8 Total water withdrawal by source. In 2013, the following is KBR's water consumption at our owned facilities: Birmingham = 3,064,966 gallons Leatherhead = 2,920,157 gallons Greenford = 2, 242,127 gallons

In 2012, the following is KBR's water consumption at our owned facilities: Birmingham = 4,165,421 gallons Leatherhead = 3,053,036 gallons Greenford = 2,242,1279 gallons

In 2011, the following is KBR's water consumption at our owned facilities: Birmingham = 4,588,845 gallons Leatherhead = 2,515,182 gallons Greenford = 2,918,308 gallons

To maintain KBR’s ISO 14001 certification, Environmental Aspect & Impact Registers are completed and maintained for all global offices. Uniformly throughout the global offices, KBR implements and sustains several initiatives to reduce our potential global impacts. KBR uses low-water usage water faucets and performs planned preventive maintenance to ensure there are no water leaks. Our U.K. offices monitor the facilities’ water meters and perform water usage audits.

EN9 Water sources significantly affected by withdrawal of water.

KBR is not aware of our significantly affecting water sources from withdrawal of water from office activities.

EN10 Percentage and total volume of water recycled and reused.

KBR does not use recycled and/or reused water for our office operations.

EN11 Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas.

KBR is not aware of our owning and/or leasing land in, or adjacent to, protected areas of high biodiversity value outside protected areas.

EN14 Strategies, current actions, and future plans for managing impacts on biodiversity.

Our Leatherhead office established appropriate containment measures, including review and understanding of drainage plans, spill cleanup kits, buffer zones and timing of grounds works to minimize disturbance to sensitive flora and fauna in local ecosys-tem. In addition, the Leatherhead office uses a drift assessment when using chemical sprays onsite.

EN16 Total direct and indirect greenhouse gas emissions by weight.

In 2013, the KBR’s total direct and indi-rect energy consumption at our owned facilities was 2,315 tCO2e.

In 2012, the KBR’s total direct and indi-rect energy consumption at our owned facilities was 9,066 tCO2e.

In 2011, the KBR’s total direct and indi-rect energy consumption at our owned facilities was 9,587 tCO2e.

EN17 Other relevant indirect greenhouse gas emissions by weight.

In 2013, KBR’s global business travel emissions, including airline vehicle, and hotel were 36,867 tCO2e.

In 2012, KBR's global business travel emissions, including airline vehicle, and hotel were 46,175 tCO2e.

In 2011, KBR's global business travel emissions, including airline, vehicle, and hotel were 80,059 tCO2e.

KBR requires preferred hotel suppliers to provide environmental and sustainability information in requests for proposals, which is considered during supplier evaluation. Provided information includes participation in one or more of the following sustainability programs: Energy Star, GreenLeaf, LEED, ISO 14001, EarthCheck, Green Globe, AAA Tourism Eco Friendly Star, EcoLabel, Green Tourism Business Scheme, IHG Green Engage Program and Project Planet. More than 100 of our preferred hotels participate in one or more of these programs. KBR’s policy requires that employees’ travel in economy or economy-plus for airline travel and rent-standard cars for auto rental. While there are some exceptions, following these policies enables KBR’s employees to reduce their travel emissions in lieu of traveling business class and/or renting a larger vehicle.

EN22 Total weight of waste by type and disposal method

In 2013, our KBR-owned offices pro-duced the following amounts of waste: Birmingham: 34,942 pounds of paper Leatherhead: 553,360 pounds Greenford: 230,846 pounds The following are the annual average recycling rates: Birmingham: 74 percent paper only Leatherhead: 100 percent total waste Greenford: 97 percent total waste

In 2012, our KBR-owned offices pro-duced the following amounts of waste: Birmingham: 30,819 pounds of paper Leatherhead: 682,021 pounds Greenford: 309,032 pounds The following are the annual average recycling rates: Birmingham: 64 percent paper only Leatherhead: 93 percent total waste Greenford: 97 percent total waste

In 2011, our KBR-owned offices pro-duced the following amounts of waste: Birmingham: 27,492 pounds of paper Leatherhead: 837,756 pounds Greenford: 325,986 pounds The following are the annual average recycling rates: Birmingham: 64 percent paper only Leatherhead: 93 percent total waste Greenford: 96 percent total waste

At both the Leatherhead and Greenford offices, waste is collected in general waste and mixed recycling. To maintain KBR’s ISO 14001 certification, Environmental Aspect & Impact Registers are completed and maintained for all global offices. Uniformly throughout the global offices, KBR implements and sustains several initiatives to reduce our potential global impacts.To reduce waste production from document printing through printers, copies and plotters, KBR has taken measures to reduce releases to landfills from excessive use of paper. All global KBR offices establish Outlook public folders for employees to store emails in lieu of printing them. Paper recycling bins are provided in all KBR offices where recycle programs are available. Global offices also encourage the use of double-sided printing by setting double-sided printing as the printer default, and all offices encourage the purchase and use of recycled paper.To reduce disposal of non-biodegradable wastes to landfills, all global staff are provided with access to separate bins for paper recycling and other waste that can accumulate from desk spaces. Globally, cardboard recycling is greatly encouraged where possible. KBR implements several initiatives in offices to end the use of phone books, which typically are not recycled and sent to landfills. KBR offices phone list is available electronically via Outlook Properties. KBR ensures that employees can access online phone directories by providing wireless Internet throughout offices. Some employees may remotely access the online directory via their personal Internet if necessary.

EN23 Total number and volume of significant spills.

During 2013, KBR did not have any significant spills.

During 2012, KBR did not have any significant spills.

During 2011, KBR did not have any significant spills.

EN25 Identity, size, protected status, and biodiversity value of water bodies and related habitats significantly affected by the reporting organization’s discharges of water and runoff.

KBR is not aware of our owned office operations’ discharges of water and runoff significantly affecting water bodies and/or related habitats.

BenefitLife insuranceHealth careDisability/invalidity coverageParental leaveRetirement provisionStock owndershipOther benefits

United StatesTemporary

Basic or optional lifeMedical, dental, vision

Short- & long-term disability

N/AESPP offering

N/A

Part-timeBasic or optional life

Medical, dental, visionShort- & long-term disability

N/A

-N/A

United KingdomTemporary

----

No diff. beg. 11/1/13ESPP offering

N/A

Part-time------

N/A

CanadaTemporary

N/ARetirement & pension plans

N/AN/A

Basic or optional lifeMedical, dental

Short- & long-term disability

Part-time

N/A-

N/AN/A

unpaid FMLA offered if 1 yr of service and 1250 hours worked in last yr

Benefit

Notes:- Temporary and part-time employees may participate in the US retirement plan.- ESPP is only offered to full-time and part-time employees in the US, UK, and Australia.- In the US and Canada, employees that work more than 20 hours per week are health & welfare benefits eligible unless classified as temporary employees- In Australia, KBR contributes to the Super Guarantee Contribution for all employees including temporary and part-time. However, temporaryemployees' contributions are invested in a default industry superfund rather than receiving investment options like the part-time and full-time employees.- Statutory requirement for UK to automatically enroll temporary employees in the UK pension plan beginning November 1, 2013.- Regular, non-unionized employees in Canada may participate in their retirement and pension plans.- N/A indicates that there are no associated benefits offered in the country.- "-" indicates that the benefits are the same as full-time employees.

Life insuranceHealth careDisability/invalidity coverageParental leave

Retirement provisionStock owndershipOther benefits

AustraliaTemporary

--

Income Protection KBR Fundedmay be eligible for unpaid parental leave (not eligible

for paid Maternity Leave) -

ESPP offeringSalary packaging

Part-time----

---

N/AN/AN/AN/A

N/AN/AN/A

N/AN/AN/AN/A

N/AN/AN/A

Middle EastTemporary Part-time

GRI IndicatorGRI Indicator Description

2013 2012 2011

LA8 Education, training, counseling, prevention, and risk-control programs in place to assist workforce members, their families, or community members regarding serious diseases.

Destination: You Destination: You is an activity-tracking program whereby employees wear an activity tracker on their shoe. As participants move around and perform daily tasks, as well as during exercise, the tracker counts the number of steps taken, distance walked, calories burned and the time of the activity. Participants must walk past an upload device located at the reception area in their building and their steps data is wirelessly uploaded to a personal web page where they can view their progress. The goal of the program is for each participant to reach 1 million steps between February 1, 2013, to October 31, 2013. Program Success: 554 (46 percent) completed 1 million steps.Total steps taken by participations was more than 1.4 billion. Flu Shots Flu shots were provided on-site at no cost to 1,625 employees at six KBR locations throughout the U.S. We also provided a Walgreens flu shot voucher to 243 employees at locations where it was not feasible to provide the shots on-site. Other Programs KBR Healthy Steps also offers various other programs to help employees live healthy lifestyles. These include on-site chair massages, Weight Watchers, discounts to the YMCA and other fitness facilities, and discounts at My Fit Foods and health fairs.

Destination: You Destination: You is an activity-tracking program whereby employees wear an activity tracker on their shoe. As participants move around and perform daily tasks, as well as during exercise, the tracker counts the number of steps taken, distance walked, calories burned and the time of the activity. Participants must walk past an upload device located at the reception area in their building and their steps data is wirelessly uploaded to a personal web page where they can view their progress. The goal of the program is for each participant to reach 1 million steps between February 1, 2012, to October 31, 2012. Program Success: 393 (43 percent) completed 1 million steps. Flu Shots Flu shots were provided on-site at no cost to 1,564 employees at six KBR locations throughout the U.S. We also provided a Walgreens flu shot voucher to 532 employees at locations where it was not feasible to provide the shots on-site. Other Programs KBR Healthy Steps also offers various other programs to help employees live healthy lifestyles. These include on-site chair massages, Weight Watchers, discounts to the YMCA and other fitness facilities, and discounts at My Fit Foods and health fairs.

Flu Shots Flu shots were provided at no cost to 1,935 employees at seven KBR locations throughout the U.S. We also provided a Walgreens flu shot voucher to more than 300 craft employees at locations where it was not feasible to provide the shots on-site. Other Programs KBR Healthy Steps also offers various other programs to help employees live healthy lifestyles. These include health coaching for lifestyle and chronic disease conditions, on-site chair massages, Weight Watchers, discounts to the YMCA and other fitness facilities, and discounts at My Fit Foods and health fairs.

LA9 Health and safety topics covered in formal agreements with trade unions

While KBR has collective bargaining agreements globally, a large percentage of KBR’s collective bargaining agreements are in Canada. The following are typical health and safety topics covered in our Canadian agreements.All work shall be performed, and equipment operated, according to accepted safety conditions which must conform to the applicable provincial or federal regulations, acts and laws, and to employer regulations. Fresh, safe, cool drinking water and sanitary cups shall be furnished to the employees. KBR shall provide adequate sanitary facilities on the job for the welfare of our employees and protection of public health, and these facilities must be heated when necessary and provided with toilet tissue and kept clean with adequate facilities for wash-up (hot and cold running water) where practical. Joint Management-Employee Health and Safety CommitteesIn order to build a cooperative relationship between KBR, the Union and the employees, committee meetings will be scheduled for each project. The meetings will serve as a forum for discussion and consultation about policies and practices covered by, and not necessarily covered by the collective agreement affecting the project. The areas for discussion may include safety measures, matters that affect the working conditions of employees, training and promotion, hiring policies, and discipline and discharge policies.When necessary, a committee will be established to address matters concerning safe work conditions and practices and to maintain a cooperative effort for the safety of the workforce. Meeting notes will record the business of each meeting, and copies will be distributed as the committee determines. KBR and the Union will each appoint representatives to the committee. KBR will make practicable provisions for the safety and health of our employees during the hours of their employment. Such provisions will be made known to all employees at the time of hire. The Union undertakes to give full support to these objectives by promoting safety consciousness and a personal sense of responsibility among the employees. It is the intent of the parties to have working conditions that are safe and healthy. An employee who is injured on the job during working hours and is required to leave for treatment for such injury will receive payment for the remainder of his or her shift. An employee who is injured on the job and who requires transportation from the work site to a local physician or hospital will receive such transportation provided for by KBR. Should an employee require hospitalization for a period of more than one week, KBR will provide transportation to an available facility near the employee’s home within Canada at no cost to the employee.If an employee is injured on the job and requires medical attention, the employee may be entitled to modified work and will inform the attending physician of the same. KBR reserves the right to require a second medical opinion by a physician selected by KBR. KBR will inform the physician of the types of modified work which may be available to the employee and will make the same available to the employee with the physician’s approval. The parties recognize the need for a safe workplace free of alcohol and drug use, along with employees being fit for duty. To that end, the parties agree that, where it is considered to be appropri-ate, KBR may develop a Drug and Alcohol Policy that complies with current legislation.

LA10 Average hours of training per year per employee by gender, and by employee category.

For 2013, total employee training hours were 83,300 hours, which includes KBRU, leadership development and classroom training.

For 2012, total employee training hours were 187,718 hours, which includes KBRU, leadership development and classroom training.

For 2011, total employee training hours were 230,510 hours, which includes KBRU, leadership development and classroom training.

54 55GRI Indicator

GRI Indicator Description

2013 2012 2011

LA6 Percentage of total workforce represented in formal joint management–worker health and safety committees that help monitor and advise on occupational health and safety programs.

KBR gives every employee the opportunity to offer input into QHSE matters in their workplace. KBR management requires location managers (project/office) to promote communication and cooperation between management and employees in creating an incident- and injury-free workplace. When appropriate, every KBR meeting begins with a “safety moment” related to a HSE topic. Safety meetings (or Toolbox Meetings) are mandatory for all KBR project/office personnel and must be conducted and attended at least weekly. Individual departments may elect to conduct more regular safety meetings based upon their specific needs. Each KBR office has a Home Office Safety Awareness Team (HOSAT), which includes location top management, facility manage-ment and HSE leadership. HOSAT forms a joint management/employee consultative group to identify and resolve HSE issues. Personnel may raise HSE issues with either their Safety Meeting Coordinator or the supervisor of the relevant area. More than 75 percent of our total workforce is represented by HOSAT and safety meetings. HOSAT is responsible for the completion of our office risk registers, which is part of our Integrated Management System.

LA7 Rates of injury, occupational diseases, lost days, and absenteeism, and number of workrelated fatalities by region and by gender.

For 2013, KBR’s Total Recordable Incident Frequency Rate = 0.38 Total Lost Time Incident Frequency Rate = 0.06 Total Recordable Incidents = 279 Occupational Disease Incidents = 5 Lost Time Incidents = 47 Fatalities = 0

For 2012, KBR’s Total Recordable Incident Frequency Rate = 0.36 Total Lost Time Incident Frequency Rate = 0.09 Total Recordable Incidents = 285 Occupational Disease Incidents = 92 Lost Time Incidents = 73 Fatalities = 1

For 2011, KBR’s Total Recordable Incident Frequency Rate = 0.0.37 Total Lost Time Incident Frequency Rate = 0.10 Total Recordable Incidents = 468 Occupational Disease Incidents = 77 Lost Time Incidents = 128 Fatalities = 2

LA8 Education, training, counseling, prevention, and risk-control programs in place to assist workforce members, their families, or community members regarding serious diseases.

Healthy Steps U.S. The Healthy Steps program for U.S.-based employees in 2013 gave employees the op-portunity to earn a $300 Healthy Reward. When employees completed the required step of getting an annual physical or partic-ipating in an on-site health screening, they earned $150. They could earn an additional $150 by completing various Healthy Steps and wellness activities. The Healthy Re-ward was paid out to employees in cash to their paychecks. 2,924 employees earned a Healthy Reward. Examples of the wellness activities employees could complete included: • Required Step – Attend a work site health screening or annual physical at their physician ($150) • Completion of Destination: You program – at least 1 million steps required ($100) • Get a dental exam ($25) • Get a flu shot ($25) • Get a cancer screening ($50) • Lifestyle Health Coaching ($100) • Condition Management Health Coaching for employees with asthma, diabetes, COPD, CAD and CHF ($100) A wellness vendor, LiveHealthier, was hired to help administer the program and provide a customized wellness portal, incentive tracking, telephonic health coaching services, quarterly health challenges, health education content and health screenings.

Health Screenings U.S. Employees in the KBR Tower, Eldridge Oaks, Birmingham, Newark, Arlington, Chicago, Sandy and Raleigh offices were offered a free health screening provided by our vendor, LiveHealthier. The screening in-cluded a blood pressure, body fat and body mass index measurement (BMI), a finger stick cholesterol test including glucose, HDL and LDL, triglycerides and a waist circumference measurement. Participants were given the opportunity to sit down with a health coach at the screening event to discuss their results and a path forward to improve their overall health. Program Success: 1,620 employees participated in the on-site screening events, which was a 5 percent increase from 2012. High-risk groups for HDL and BMI were reduced from 2012. U.K. Employees in the Greenford and Leatherhead offices participated in on-site health screenings. A total of 415 employees participated. Australia Employees in six different office locations participated in on-site health screenings. A total of 272 employees participated.

Healthy Steps U.S. The Healthy Steps program for U.S.-based employees in 2012 gave employees the op-portunity to earn a $300 Healthy Reward. When employees completed the required step of getting an annual physical or participating in an on-site health screening, they earned $150. They could earn an addi-tional $150 by completing various Healthy Steps and wellness activities. The Healthy Reward was paid out to employees in cash to their paychecks. Examples of the wellness activities employees could complete included: • Required Step – Attend a work site health screening or annual physical at their physician ($150) • Completion of Destination: You program – at least 1 million steps required ($100) • Get a dental exam ($25) • Get a flu shot ($25) • Get a cancer screening ($50) • Lifestyle Health Coaching ($100) • Condition Management Health Coaching for employees with asthma, diabetes, COPD, CAD and CHF ($100) A wellness vendor, LiveHealthier, was hired to help administer the program and provide a customized wellness portal, incentive tracking, telephonic health coaching services, quarterly health challenges, health education content and health screenings.

Health Screenings U.S. Employees in the KBR Tower, Eldridge Oaks, Birmingham, Newark, Arlington, Chicago, Sandy and Raleigh offices were offered a free health screening provided by our vendor, LiveHealthier. The screening in-cluded a blood pressure, body fat and body mass index measurement (BMI), a finger stick cholesterol test including glucose, HDL and LDL, triglycerides and a waist circumference measurement. Participants were given the opportunity to sit down with a health coach at the screening event to discuss their results and a path forward to improve their overall health. Program Success: 1,535 employees participated in the on-site screening events, which was a 26 percent increase from 2011. High-risk groups for HDL and BMI were reduced from 2011. U.K. Employees in the Greenford and Leatherhead offices were given the opportunity to participate in on-site health screenings for the first time in September. A total of 580 employees participated. Australia Employees in six different office locations were given the opportunity to participate in on-site health screenings for the first time in August. A total of 364 employees participated.

Healthy Steps The Healthy Steps program for 2011 was a points-based program in which employees earn Health Points by completing Healthy Steps and activities. The goal for the program was to reach 50 points. When employees complete the required step of getting an annual physical or participating in an on-site health screening, they earn 25 Health Points and a $100 Healthy Reward. If they earn another 25 points by completing certain healthy activities, they earn an additional $100 Healthy Reward for a total of $200. The reward was given to them in FSA or HSA dollars in January 2012. Examples of the healthy activities employees can complete to earn health points include: • Required Step – Attend a work site health screening or annual physical at their physician (25 points) • Completion of Destination: You program – at least 1 million steps required (10 points) • Get a dental exam (5 points) • Get a flu shot (5 points) • Get a cancer screening (10 points) • Wellness Coaching (4 points) Program Success: 2,334 employees earned one of the Healthy Rewards. 1,220 employees participated in the on-site screening events which was an 11 percent increase from 2010.

Health Screenings Employees in the KBR Tower, Eldridge Oaks, Birmingham, Newark, Arlington, Chicago, Sandy and Raleigh offices were offered a free health screening provided by UnitedHealthcare. The screening included a blood pressure, body fat and body mass index measurement, a finger stick cholesterol test including glucose and HDL results. Employees were given the opportunity to sit down with a health coach at the screening event to discuss their results and a path forward to improve their overall health. Program Success: 1,220 employees participated in the on-site screening events which was an 10 percent increase from 2010. High-risk groups for total cholesterol, glucose, blood pressure and body fat percentage were reduced from 2010. Destination: You Destination: You is an activity-tracking program whereby employees wear an activity tracker on their shoe. As participants move around and perform daily tasks, as well as during exercise, the tracker counts the number of steps taken, distance walked, calories burned and the time of the activity. Participants must walk past an upload device located at the reception area in their building and their steps data is wirelessly uploaded to a personal web page where they can view their progress. The goal of the program is for each participant to reach 1 million steps between February 1, 2011, to September 30, 2011. Program Success: 511 (54 percent) completed 1 million steps. Total steps taken by participants was more than 665 million.

GRI IndicatorGRI Indicator Description

2013 2012 2011

HR2 Percentage of significant suppliers, contractors and other business partners that have undergone human rights screening, and actions taken.

Significant suppliers and other business partners are vetted though our contracting policies and a due diligence process designed to elicit general business information for evaluation to enter the contract, and may include information related to anti-corruption and human rights where applicable to the scope of the services. KBR uses MK Denial data when necessary to ensure that suppliers are not listed as "denied parties" on a list of prohibited parties maintained by the U.S. or other relevant government. Prior to executing any significant supplier and other business partner agreements, KBR requires the significant supplier and other business partner to execute a certification that it will comply with KBR's Code of Business Conduct for International Business Relationships, the FCPA and other applicable anti-corruption laws. KBR requires that the Board of Directors, appropriate employees of KBR, international commercial intermediaries and partners receive periodic training regarding the FCPA, other applicable anti-corruption laws, and KBR policies and procedures designed to ensure compliance with such laws. KBR may also require that an international services intermediary receive periodic training.

HR3 Total hours of employee training on policies and procedures concerning aspects of human rights that are relevant to operations, including the percentage of employees trained.

97 percent of employees completed the 2013 COBC Training, which includes training on KBR’s anti-corruption policies and procedures. Employees completed more than 26,200 hours of COBC training.

90 percent of employees completed the 2012 COBC Training, which includes training on KBR’s anti-corruption policies and procedures. Employees completed more than 30,700 hours of COBC training.

90 percent of employees completed the 2011 COBC Training, which includes training on KBR’s anti-corruption policies and procedures. Employees completed more than 24,600 hours of COBC training.

HR4 Total number of incidents of discrimi-nation and corrective actions taken.

During 2013, there were three discrim-ination claims resolved through KBR’s Dispute Resolution Program. In 2013, KBR’s Ethics Hotline received 324 calls with 37 percent of calls related to COBC issues.

During 2012, there were four discrimi-nation claims resolved through KBR's Dispute Resolution Program. In 2012, KBR's Ethics Hotline received 301 calls with 41 percent of calls related to COBC issues.

During 2011, there were 13 discrimi-nation claims resolved through KBR's Dispute Resolution Program. In 2011, KBR’s Ethics Hotline received 669 calls with 18 percent of calls related to COBC issues.

HR5 Operations and significant suppliers identified in which the right to exercise freedom of association and collective bargaining may be violated or at significant risk, and actions taken to support these rights.

KBR is not aware of any significant suppliers identified in which the right to exercise freedom of association and collective bargaining may be violated or is at significant risk.

HR6 Operations and significant suppliers identified as having significant risk for incidents of child labor, and measures taken to contribute to the effective abolition of child labor.

As stated in KBR’s Code of Business Conduct and supported in a letter to employees by our CEO, KBR cannot in any way accept, condone or tolerate any instance of unethical or illegal behavior. KBR is not aware of any operations or significant suppliers as having significant risk for incidents of child labor. Measures taken to contribute to the effective abolition of child labor include requiring employees, subcontractors and agents to complete KBR's mandatory Code of Business Conduct (COBC) training, which includes human rights training. The charter mission of KBR’s Board of Directors’ CSR Committee oversees the activities of KBR in managing our major risk exposures in regards to sustainable development, including human rights. KBR does not employ anyone, in any capacity, under the age of 18 years except where this minimum employment age requirement is superseded by local law.

HR7 Operations and significant suppliers identified as having significant risk for incidents of forced or compulsory labor, and measures to contribute to the elimination of all forms of forced or compulsory labor.

As stated in KBR’s Code of Business Conduct and supported in a letter to employees by our CEO, KBR cannot in any way accept, condone or tolerate any instance of unethical or illegal behavior. KBR is not aware of any operations or significant suppliers as having significant risk for incidents of forced or compulsory labor. Measures taken to contribute to the effective abo-lition of forced or compulsory labor include requiring employees, subcontractors and agents to complete KBR's mandatory Code of Business Conduct (COBC) training, which includes human rights training. The charter mission of KBR’s Board of Directors’ CSR Committee oversees the activities of KBR in managing our major risk exposures in regards to sustainable development, including human rights.

HR8 Percentage of security personnel trained in the organization’s policies or procedures concerning aspects of human rights that are relevant to operations.

100 percent of our Security personnel completed the 2013 COBC Training.

100 percent of our Security personnel completed the 2012 COBC Training.

100 percent of our Security personnel completed the 2011 COBC Training.

HR9 Total number of incidents of violations involving rights of indigenous people and actions taken.

KBR is not aware of any incidents of violations involving rights of indigenous people.

HR10 Percentage and total number of operations that have been subject to human rights reviews and/or impact assessments.

KBR is not aware of any of our operations being subject to human rights reviews and/or impact assessments.

HR11 Number of grievances related to human rights filed, addressed and resolved through formal grievance mechanisms

During 2013, there were three discrim-ination claims resolved through KBR’s Dispute Resolution Program. In 2013, KBR’s Ethics Hotline received 324 calls with 37 percent of calls related to COBC issues.

During 2012, there were four discrim-ination claims and one harassment claim resolved through KBR's Dispute Resolution Program. In 2012, KBR's Ethics Hotline received 301 calls with 41 percent of calls related to COBC issues.

During 2011, there were eight harass-ment and 13 discrimination claims resolved through KBR's Dispute Reso-lution Program. In 2011, KBR’s Ethics Ho-tline received 669 calls with 18 percent of calls related to COBC issues.

The KBR Dispute Resolution Program (DRP) actively promotes resolution by providing tools and options for employees seeking a collaborative approach to workplace conflict. Built on a foundation of confidentiality, neutrality and independence, the DRP adheres to the code of ethics and standards of practice of the International Ombudsman Association (IOA).

SO1 Percentage of operations with implemented local community engagement, impact assessments, and development programs.

KBR projects in the FEED and engineering, procurement and construction (EPC) phases are executed in a manner consistent with the project-specific Environmental, Social and Health Impact Assessment (ESHIA). The critical elements of an ESHIA for major projects worldwide include social and health impacts, as well as environmental impacts. The owner defines and requires that impacts on the social and economic status of the local communities be addressed for each phase of the project, from design through construction and operation. Requisite plans are developed during engineering, including but not limited to HSE plans, stakeholder engagement plans, local content plans, etc. As an EPC contractor, KBR has input into and plays an active role in community involvement/stakeholder engagement. Working with the Owner, KBR ensures that site-specific environmental, health and safety issues are well defined and mitigation measures are implemented. Documentation of performance against project goals is provided by a monitoring program. As projects move the field, comprehensive community consultation programs are put in place.

SO2 Percentage and total number of business units analyzed for risks related to corruption.

All transactions are analyzed for risks related to corruption. As stated in KBR’s Code of Business Conduct and supported in a letter to employees by our CEO, KBR cannot in any way accept, condone or tolerate any instance of unethical or illegal behavior. The charter mission of KBR’s Board of Directors’ CSR Committee oversees the activities of KBR in managing our major risk exposures in regards to sustainable development, including human rights.

56 57GRI Indicator

GRI Indicator Description

2013 2012 2011

LA11 Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings.

Educational AssistanceIt is KBR’s intent that every employee realizes his or her full potential in an environment that values productivity and results. To this end, KBR provides educational opportunities that enable employees to improve their skills and/or knowledge outside the scope of standard on-the-job informal training.Educational assistance whenever possible should be planned and budgeted in advance, and applicable to an employee’s current or projected position. All costs incurred will be applicable to the cost center where the employee resides. Additionally, eligible employees are approved based on managerial discretion, and on the condition that studies must be completed without jeopardizing the employee’s work performance. Further, employees must show evidence of successful course completion at the conclusion of the course of study. In addition to country-specific eligibility requirements, specific monetary limits may be imposed. Participation in this program does not guarantee a promotion or change in job responsibilities and earnings.Following the reimbursement payment date of educational assistance, the employee is obligated for the course of one year to reimburse monies paid in the event of resignation or separation for cause. Upon acceptance of reimbursement, the employee authorizes KBR to take this deduction from any monies that may be owed to the employee. Reimbursement may also be applicable to an employee transferring from one manager to another across budgetary lines.Internal Training CoursesKBR is committed to the continued development of our employees and believes that the employee and KBR have a shared re-sponsibility for career and competency development. KBR recognizes the need for employees to acquire additional skills, knowl-edge and experience to meet the short-term needs of their jobs, as well as the longer-term needs of the individual and company.The KBR Transferable Competency model is core to The KBR Way and the creation of a culture focused on hiring the right people, requiring them to behave in a way that is consistent with our business values and brand, and executing processes that will allow us to win in the marketplace. The educational material contained in KBRU is to assist KBR, managers and employees globally to be more productive and have more meaningful and consistent conversations about performance, putting us on the path toward creating a more enriching experience at KBR. The competency model contains seven transferable competencies and is aligned with KBR’s Mission, Vision and Values: • Quality, Health, Safety & Environment • Commercial Focus • Leadership • Business Process Thinking • Strategic Process Thinking • Empowerment • Communications. Time OffBalancing the demands of work and personal life is a concern for many of our dedicated employees. It is KBR’s intent that every employee realizes his or her full potential in an environment that values productivity and results and where people have the flexibility and control to get the job done and balance their other commitments. To this end, KBR provides several options for time off that enable employees to manage work and personal life responsibilities, regardless of whether the time off is for personal reasons, illness, educational obligations or family leave.Depending on the type of leave, specific local eligibility requirements need to be met. These eligibility requirements may include time accruals, length-of-service and court-ordered instruction, as well as country-specific rules and legislation. Time away from work due to a leave of absence will not exceed 24 months for continuous and consecutive time off. Annual rollover balances applicable to vacation and sick leave will not exceed 400 hours (500 hours prior to December 29, 2012). Additionally, all time off is subject to supervisor approval and workload demand. Provisions within project-specific employment agreements or contracts for mergers and acquisitions supersede this policy and may affect overall application of service time.Severance PayIn the U.S., an employee is eligible for severance pay upon the involuntary termination of employment due to reduction in force or a release from employment for the convenience of KBR. The covered employee’s length of service used in calculating severance pay is determined by the employee’s most recent hire date. Severance is based on full and completed years of service. No service credit is given for partial years of service. Length of Service for Exempt EmployeesLess than three years - the equivalent of two weeks’ regular payThree to four years - the equivalent of four weeks’ regular payFive to 19 years - the equivalent of six weeks’ regular pay20-plus years - the equivalent of eight weeks’ regular payLength of Service for Non-Exempt EmployeesLess than three years - the equivalent of one week regular payThree to four years - the equivalent of two weeks’ regular payFive to 19 years - the equivalent of three weeks’ regular pay20-plus years - the equivalent of four weeks’ regular pay

KBR, at our sole discretion, may substitute notice in lieu of all or part of the pay described above.If an employee is selected for termination due to a reduction in force and the employee meets the eligibility requirements for retirement, then the reason for the termination is documented as retirement in lieu of reduction in force, and the employee is eligible for severance pay. The basis for an employee’s selection for reduction in force shall not be based on their eligibility for retirement. Retirement TrainingKBR provides retirement specialists who have extensive knowledge of KBR’s retirement process. The retirement specialists assist employees with understanding their benefit options and the forms and information that will be received, determining what actions are need to take and when, set up necessary phone appointments and follow-ups, and process benefit elections. After retirement, KBR allows retirees to use the Employee Assistance Program. In the U.S. and if necessary requirements are met, retirees may enroll in KBR’s Retiree Medical Program.

LA13 Composition of governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity.

The Board is comprised of eight independent/non-executive directors. Of the eight independent/non-executive directors, one is a woman. The Board is comprised of eight males (89 percent) and one female (11 percent). One member is African-American (11 percent). The age groups are: 50s (22 percent), 60s (56 percent) and 70s (22 percent). The Audit Committee is currently comprised of four males (100 percent), one of whom is African-American (25 percent). Three members are in their 60s (75 percent) and one is in his 70s (25 percent). The Compensation Committee is currently comprised of three males (75 percent) and one female (25 percent). One member is in her 50s (25 percent), two members are in their 60s (50 percent) and one member is in his 70s (25 percent). The NCG Committee is currently comprised of four males (100 percent). Two members are in their 60s (50 percent) and two members are in their 70s (50 percent). The CSR Committee is currently comprised of three males (75 percent) and one female (25 percent). One member is African-American (25 percent). One member is in her 50s (25 percent) and three members are in their 60s (75 percent). Please view the KBR Workforce section for employee data.

LA14 Ratio of basic salary and remunera-tion of women to men by employee category, by significant locations of operation.

KBR considers this informaton proprietary.

HR1 Percentage and total number of significant investment agreements and contracts that include clauses incorporating human rights concerns, or that have undergone human rights screening.

KBR’s due diligence process during our commercial transaction phases is designed to elicit general business information for evaluation to enter the contract and may include information related to anti-corruption and human rights where applicable to the scope of the services. KBR uses MK Denial data when necessary to ensure that suppliers are not listed as "denied parties" on a list of prohibited parties maintained by the U.S. or other relevant government. When necessary due to the scope of services, KBR requires contractors and suppliers to certify compliance with KBR's Code of Business Conduct for International Business Relationships, the FCPA and other applicable anti-corruption laws. KBR’s Code of Business Conduct and other corporate policies address global human rights, equal employment opportunity, harassment and health, safety and environment.

GRI IndicatorGRI Indicator Description

2013 2012 2011

PR2 Total number of incidents of non- compliance with regulations and voluntary codes concerning health and safety impacts of products and services during their life cycle, by type of outcomes.

During April 2013, KBR received a serious noncompliance with 30 CFR 56.11001 by the Mine Safety & Health Administration. KBR received a $807 fine. KBR ensured all access points were cleared. During May 2013, KBR received a serious noncompliance with 30 CFR 56.18002 by the Mine Safety & Health Administration. KBR received a $807 fine. KBR designated a competent person to examine each working place at least once weekly. During September 2013, KBR received four other-than-serious noncomplianc-es with 30 CFR 56.12018, 56.12004, 56.12032 and 56.20014 by the Mine Safety & Health Administration. KBR re-ceived two fines in the amount of $499, as well as fines of $100 and $745. KBR identified and labeled power switches; identified and corrected the exposure of electrical conductors; identified and corrected cover plates, and reviewed procedures to prevent reoccurrences of missing cover plates; and removed food items from exposed areas where chemicals are present, and reviewed these procedures.

During February 2012, KBR received a serious noncompliance with 29 CFR 1910.132 and 29 CFR 1910.151 by the Occupation Safety and Health Adminis-tration. KBR received a $5,000 fine. All recommendations were corrected, and KBR reviewed policies and procedures with employees to ensure a repeat violation does not reoccur. The violation was discussed with our client. During July 2012, KBR received noncompliances with 29 CFR 1926.21, 29 CFR 1926.51 and 29 CFR 1926.62 by the Occupation Safety and Health Administration. KBR received a $10,000 fine. KBR agreed to modify the method in which it assesses potential hazards in the pre-mobilization plan and for add-on projects. During September 2012, KBR received a significant noncompliance with 30 CFR 56.11001 and 30 CFR 56.20003 by the Mine Safety & Health Administration. KBR received $117 and $285 fines. KBR corrected the action by providing more access/egress points and correcting areas that contain wood splinters during daily pre-site inspections.

During March 2011, KBR received an other-than-serious noncompliance with 29 CFR 1926.1126 – Chromium (VI) by the North Carolina Department of Labor. KBR received a $6,300 fine. KBR visited with OSHA to investigate an employee compliant. After the investigation, OSHA reduced the citation from serious to other, but cited KBR for the alleged reoccurrence. During June 2011, KBR received an other-than-serious noncompliance with 29 CFR 1910.146 by the Occupation Safety and Health Administration. KBR received a $4,200 fine. OSHA investigated an employee complaint and cited KBR for inspection procedures of monitoring devices. In the closing conference, OSHA reduced the citation from serious to other and also reduced the fine.

PR4 Total number of incidents of non-com-pliance with regulations and voluntary codes concerning product and service information and labeling, by type of outcomes.

During the reporting period, KBR has no incidents of noncompliance with regulations and voluntary codes concerning product and service information and labeling.

PR5 Practices related to customer satis-faction, including results of surveys measuring customer satisfaction.

KBR North American Government and Logistics (NAGL) performs client and customer surveys. Client surveys are performed every quarter, and customer surveys are performed daily for each critical service area via customer feedback. The survey results are consolidated into metrics for management reviews on a monthly basis. Actions are taken based on cause trends from the monthly metrics at the project level and are documented into KBR’s web-based data management for quality.

PR7 Total number of incidents of non-com-pliance with regulations and voluntary codes concerning marketing com-munications, including advertising, promotion, and sponsorship by type of outcomes.

During the reporting period, KBR has no incidents of noncompliance with regulations and voluntary codes concerning marketing communications, including advertising, promotion and sponsorship.

PR8 Total number of substantiated complaints regarding breaches of customer privacy and losses of customer data.

During the reporting period, KBR had no complaints of breaches of customer privacy.

PR9 Monetary value of significant fines for noncompliance with laws and regulations concerning the provision and use of products and services.

During the reporting period, KBR had no fines for noncompliance with laws and regulations concerning the provision and use of products and services.

58 59GRI Indicator

GRI Indicator Description

2013 2012 2011

SO3 Percentage of employees trained in organization’s anti-corruption policies and procedures.

97 percent of employees completed the 2013 COBC training, which includes anti-corruption training. 3,621 employees received additional anti-corruption training.

90 percent of employees completed the 2012 COBC training, which includes anti-corruption training. 1,491 employees received additional anti-corruption training.

90 percent of employees completed the 2011 COBC training, which includes anti-corruption training. 4,281 employees received additional anti-corruption training.

S04 Actions taken in response to incidents of corruption.

KBR has an extensive anti-corruption program. KBR completed a three-year term with an independent monitor in reviewing KBR’s compliance with anti-corruption laws. The monitorship was completed in February 2012 after the monitor certified to the U.S. Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) that “KBR’s anti-corruption program is appropriately designed and implemented to ensure compliance with the FCPA and other applicable anti-corruption laws.” All KBR employees are required to complete Code of Business Conduct (COBC) training annually, and KBR also has an extensive training program focused specifically on anti-corruption that includes live and online training. In February 2009, Kellogg Brown & Root, LLC, entered a guilty plea to violations of the FCPA in the U.S. District Court, Southern District of Texas, Houston Division (the Court), related to the Bonny Island investigation. The plea agreement reached with the DOJ resolved all criminal charges in the DOJ’s investigation and called for the payment of a criminal penalty of $402 million, of which Halliburton was obligated to pay $382 million under the terms of the Master Separation Agreement (MSA), while we were obligated to pay $20 million. In addition, we settled a civil enforcement action by the SEC which called for Halliburton and KBR, jointly and severally, to make payments totaling $177 million, which was paid by Halliburton pursuant to the indemnification under the MSA. We also agreed to a period of organizational probation, during which we retained a monitor who assessed our compliance with the plea agreement and evaluated our FCPA compliance program over a three-year period that ended on Febru-ary 17, 2012. At the end of the three-year period, the monitor certified that KBR’s current anti-corruption compliance program is appropriately designed and implemented to ensure compliance with the FCPA and other applicable anti-corruption laws. In February 2011, M.W. Kellogg Limited (MWKL) reached a settlement with the U.K. Serious Fraud Office (SFO) in which the SFO accepted that MWKL was not party to any unlawful conduct and assessed a civil penalty of approximately $11 million including interest and reimbursement of certain costs of the investigation, which was paid during the first quarter of 2011. The settlement terms included a full release of all claims against MWKL, its current and former parent companies, subsidiaries and other related parties, including their respective current or former officers, directors and employees with respect to the Bonny Island project. Due to the indemnity from Halliburton under the MSA, we received approximately $6 million from Halliburton in the second quarter of 2011. On March 18, 2013, we received a letter from the African Development Bank Group (ADBG) stating that they are in the process of opening a formal investigation into corruption related to the Bonny Island project discussed above. In accordance with the indemnity clauses under the MSA, we notified Halliburton and they have responded that the matter does not fall within the scope of their indemnity. We disagree with Halliburton's position and have taken necessary actions to preserve our rights. We are working with the ADBG to resolve the issue. At this time we are still in the process of evaluating the matter and it is not possible to determine the outcome, financial implications or possible debarment of one or more KBR-related entities arising from this investigation.

SO5 Public policy positions and participation in public policy development and lobbying

KBR believes strongly in the democratic process. Our directors, employees and legal agents should take an active interest in fostering principles of good government in the nations, states and communities in which they live. Directors and employees may spend their own time and funds supporting political candidates and issues, but they will not be reimbursed by KBR. Directors, employees and legal agents should ensure that their personal political contributions and activities are in compliance with applicable law. Furthermore, KBR will comply with applicable laws regulating political influence and campaign contributions. Some political conduct that is permitted and encouraged for individuals is unlawful for corporations.

SO6 Total value of financial and in-kind contributions to political parties, politicians, and related institutions by country.

KBR participates in the political process through employee contributions to the KBR Political Action Committee (KBRPAC). KBRPAC is a voluntary, nonpartisan political action committee that allows KBR employees to pool personal, voluntary financial contributions to support candidates seeking elective office at the federal, state and local levels, who support issues important to our business, our employees and our shareholders. KBRPAC operations are transparent and compliant with all applicable laws. Because they are regulated by the Federal Election Commission (FEC) and state and local election agencies, PACS are consid-ered the most transparent for of political involvement.

S07 Total number of legal actions for anticompetitive behavior, anti-trust, and monopoly practices and their outcomes.

During the reporting period, KBR has no legal actions for anti-competitive behavior, antitrust and monopoly practices.

S08 Monetary value of significant fines and total number of non-monetary sanctions for noncompliance with laws and regulations.

For 2013, KBR had no adverse determinations from the federal Equal Employment Opportunity Commission (EEOC), any state or local human rights commission, or the National Labor Relations Board (NLRB).

For 2012, KBR had no adverse determinations from the federal Equal Employment Opportunity Commission (EEOC), any state or local human rights commission, or the National Labor Relations Board (NLRB).

For 2011, KBR had no adverse determinations from the federal Equal Employment Opportunity Commission (EEOC), any state or local human rights commission, or the National Labor Relations Board (NLRB).

PR1 Life cycle stages in which health and safety impacts of products and services are assessed for improve-ment, and percentage of significant products and services categories subject to such procedures.

Safety is an important element at all stages of a project's execution. Safety issues are addressed at the conceptual stage through detailed engineering, and are then carried to the field through construction, commissioning, start-up, operation and maintenance of the facility. At KBR, safety in design is under constant review to identify and quantify hazards as the design proceeds, with the aim of engineering out potential risk conditions. The principles of safety in design, inherent safety, exposure reduction, simplification and ALARP (as low as reasonably practical) reviews are applied to further enhance the field personnel and process safety performance and enable the intended step change in project safety performance. The goal of these reviews is the identification of potential hazards so that actions can be taken during the design, which will remove the cause of the hazard and/or reduce the consequence or the likelihood of the hazard. The keywords of this approach are: prevent, control and mitigate. For example, KBR safety would consider replacing a process that uses dangerous chemicals with one that uses something with fewer safety concerns, would investigate whether less storage of some chemicals would allow for a safer site without impacting operations, and whether the plant layout in regards to equipment spacing, wind direction and sources of ignition can improve plant safety.

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